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Wall Street Journal: The Super PAC Lesson

Monday, November 12th, 2012

Thoughts on campaign spending from the Wall Street Journal.  There was not enough of it for their tastes.

Apparently Mitt was “defenseless” against Obama’s ads.

Wall Street Journal

In every election there are issues that take up an inordinate amount of media attention but turn out to be sideshows. This year’s champion is Super PAC spending. Liberals first claimed that the Koch brothers and other wealthy donors were “buying” the election, but now that Democrats have won they are claiming that these GOP donors were gullible fools for giving at all. They’re wrong on both counts.

Money did matter, as it always does to some extent. But the cash that really counted was the more than $100 million that the Obama campaign used from May through July in the battleground states to portray Mitt Romney as Gordon Gekko without the social conscience. The Election Day exit polls show that Mr. Romney’s image never recovered from that ad barrage. He ran largely a biographical campaign and the Obama campaign destroyed his business biography. His net favorability was negative.

Mr. Romney’s advisers told us in early August that they would have liked to respond to the attacks but lacked the cash to do that and at the same time to portray a positive message after they had run through all of their money during the primary. They went with the positive message, albeit one that didn’t make much of an impact.

By the way, this is also the early-advertising strategy that Bill Clinton and adviser Dick Morris used to destroy Bob Dole in 1996. You’d think Republican strategists would have remembered that.

The GOP Super PACs tried to fill the gap by attacking Mr. Obama, but they were hard pressed to speak for a candidate whom by law they are prohibited from coordinating with. Perhaps their ads could have been more effective, and perhaps some of that money would have been better spent on matching Democratic voter turnout operations. Those questions deserve to be part of a GOP self-examination. But it’s hard to believe that Mr. Romney would have done any better if the Super PACs hadn’t existed.

All of which suggests that the real problem this year wasn’t too much campaign spending but too little. The GOP lacked the cash to counter the attack ads when its candidate really needed it. Mr. Romney raised enough money after the conventions, but by then it was too late to expand the field of competition other than with a late sneak attack of the kind the campaign tried in Pennsylvania.

In focusing so much on rich GOP donors, the media also underplayed the way the Supreme Court’s 2010 Citizens United decision helped Democrats. That ruling overturned longstanding rules that prohibited unions from using dues money to communicate politically with non-union members. This allowed unions to run more efficient voter-targeting operations, since they didn’t have to skip non-union households, and it contributed to voter turnout in places like Nevada, Wisconsin and Ohio.

The unions were also helped by the many White House and campaign officials whom Mr. Obama dispatched to fund-raise for Democratic Super PACs—when he wasn’t busy criticizing GOP spending.

The history of campaign-finance limits is that attention to the issue recedes when Democrats win. But expect it to return in time for the 2014 campaign cycle, when the media will find some new Sheldon Adelson to portray as a threat to democracy even as unions go on spending their cash below the radar.

A far better reform would remove all donation limits to candidates, so nominees like Mr. Romney of either party aren’t left defenseless again. The Super PACs would fade in importance and the candidates would get to better control their own message. The U.S. is a huge country and it takes lots of money to educate voters.

Salon: Super PAC spending is about to explode

Tuesday, October 9th, 2012

Outside groups have already poured half a billion dollars into the 2012 elections, and they’re just getting started


Things have taken a turn for the worse for Democrats in recent days — and just as the campaign enters what could be described as the super PAC death zone. Even though we’ve already seen at least $517 million spent by outside groups, almost all of it on attack ads, during this election cycle so far — more than every other cycle since 1990 at similar points combined  — the wave of outside money about to crash down on the race between now and election day could add up to double what’s already been spent.

For 10 of the past 11 election cycles, about half of the total outside money spent during the entire campaign came during the month preceding the election, according to data from the Center for Responsive Politics. In 2010, the first election following the Supreme Court’s Citizens United decision, 56 percent of the total spent that cycle came in last 30 days alone. The only exception was 2008, when a still considerable 40 percent of the total was spent in October and early November. If that past is precedent, the next month could see another $400-570 million spent, easily pushing outside spending over the $1 billion threshold.

“In a cycle where we’ve already blown away the totals for how much is being spent outside of the campaigns themselves and the parties before that time, then it’s reasonable to expect that — who knows how much? — more will come this cycle,” Bob Biersack, a senior fellow at the Center for Responsive Politics told Salon. Because of insufficient disclosure requirements, Biersack said it’s very hard to predict how much that might be. “It’s a lot harder to look forward and anticipate with these kind of activities than it is with campaigns.”

In 2010, outside groups made huge last-minute ad buys, the largest of which came from the Karl Rove-backed American Crossroads groups, which together pumped $50 million into competitive House races. That announcement didn’t come until October 13. And with Romney’s campaign suddenly ascendant after a strong debate performance last week, it’s possible donors who had been on the sidelines will suddenly decide to pony up. Democrats in the House fear their surprisingly strong positions in over 30 races could be overrun practically overnight by big, late super PAC buys.

Another new phenomenon this year is a sharp uptick in spending from groups that don’t have to disclose their donors , like 501(c)4 social welfare organizations and 501(c)6 trade organizations, like the U.S. Chamber of Commerce. So far this year, even before the final onslaught, these groups have spent more than all outside groups in 2010 combined, according to the CRP data. A court ruling in a case brought by Rep. Chris Van Hollen would have required disclosure for these groups running ads in a window immediately preceding the election, but an appellate court overturned that decision last month, allowing these groups to keep their donors secret. And not surprisingly, the vast majority of this secret money has come from conservative groups.

Of course, there’s a possibility that all this spending so late will have little impact after the deluge of political ads voters in key states have already withstood. Most consultants, political scientists, and psychologists agree that negative political ads are effective, but there may be a limit, which this election cycle could test unlike ever before. In some key media markets, which see as many as three times the number of ads as other markets, negative spots are “popping up on soap operas, game shows and even cable reality programs like Here Comes Honey Boo Boo,” NPR reported of Colorado Springs, Colorado. When voters can’t watch Honey Boo Boo dressing up Glitz Pig without being told why Barack Obama is dangerous for America, maybe they’ll ignore the message, but that remains to be seen. For now, donors are willing bet millions of dollars that the ads will do something more than annoy views.

Los Angeles Times: ‘Super PACs’ largely funded by a wealthy few

Thursday, February 2nd, 2012

A few super-rich individuals are using their personal and corporate wealth to influence American politics in an unprecedented manner

LA Times

When it comes to big money in politics, Dallas billionaire Harold Simmons’ influence has long been apparent in Texas, where he has plowed more than $1 million into Rick Perry‘s gubernatorial campaigns.

Now Simmons has found a new outlet for his outsize political giving — the explosion this election cycle of “super PACs,” independent political organizations that can accept massive contributions to influence the presidential race and other federal elections.

Simmons and his privately held holding company, Contran Corp., dumped $8.6 million into a series of GOP-allied super PACs last year, according to campaign finance records released late Tuesday night. That propels Simmons into the top tier of a newly minted millionaires’ club — super-rich individuals who are using their personal and corporate wealth to influence American politics in an unprecedented manner.

Seventeen people or companies gave at least $1 million each to super PACs last year, according to an analysis by the Los Angeles Times data desk. The infusion ushered in an era of Texas-style unlimited donations at the national level. The organizations have emerged as heavyweights in this year’s presidential contest, at times outstripping the influence of the candidates’ own campaigns.

That’s the case with former House Speaker Newt Gingrich, whose presidential bid has been kept afloat by Winning Our Future, a super PAC that has received $11 million from Las Vegas Sands Chief Executive Sheldon Adelson and his family.

The Adelsons gave the funds with no strings attached and no specific expectations, because Gingrich “is an old friend in a time of need,” said one person close to the couple. It’s wealthy individuals like the Adelsons who are largely powering these new organizations — not major corporations, as many critics on the left had warned. But because companies are probably giving to tax-exempt organizations that do not have to reveal their donors, it is impossible to get a full picture of their influence.

Many members of the millionaires’ club have, like Adelson, long been generous political donors and fundraisers. Simmons, Houston home builder Bob Perry and Dallas real estate magnate Harlan Crow are among a group of wealthy Texans that helped finance the Swift Boat Veterans for Truth, an outside group that during the 2004 campaign attacked Democratic presidential nominee John F. Kerry’s war record. They and their companies are now backing American Crossroads, the biggest Republican super PAC, which aims to spend $240 million this cycle.

In 2010, Robert Mercer, manager of the New York hedge fund Renaissance Technologies, gave $640,000 to a super PAC that tried unsuccessfully to defeat Democratic Rep. Peter A. DeFazio of Oregon, a vocal Wall Street critic. Last year, Mercer was among 10 individuals or companies writing $1-million checks to Restore Our Future, a pro-Mitt Romney super PAC.

Seven-figure contributions were rarer on the Democratic side, whose super PACs have not yet matched the fundraising of their GOP counterparts. One of the few contributions that large came from DreamWorks Animation Chief Executive Jeffrey Katzenberg, who gave $2 million in May to Priorities USA Action, a super PAC supporting President Obama.

The left relies in this cycle — as it has in the past — on the muscular role of organized labor in funding ads and turning out its members. In this election, the unions are also filling the coffers of new super PACs. The Service Employees International Union, which represents 2 million workers, gave nearly $1.6 million to Democratic-leaning super PACs in 2011. All told, SEIU is expected to spend about $85 million on political activity, equal to the record amount the union dedicated to the 2008 presidential election.

Super PACs sprang up as a result of a series of court decisions in 2010, including the Supreme Court’s Citizens United ruling, which freed corporations and unions to spend unlimited amounts on political activity. That decision has been heatedly decried by campaign finance reform advocates and many Democrats, including Obama, who has warned it will lead to a flood of unregulated corporate cash in politics.

It is difficult to determine exactly how much corporate money is in the system, since many of the outside groups are organized as nonprofits, allowing them to keep their donors secret. While American Crossroads, co-founded by GOP political strategist Karl Rove, reported the donors that gave it $18.4 million last year, its nonprofit affiliate, Crossroads GPS, raised an additional $32.6 million from undisclosed contributors.

The latest campaign finance records reveal that dozens of private companies, hedge funds and business partnerships contributed to super PACs last year. But in an initial review of the filings, Chesapeake Energy, a natural gas producer based in Oklahoma City, appears to be the only publicly traded company that gave money, making a $250,000 donation to a super PAC backing Rick Perry’s since-suspended presidential bid.

Chesapeake did not immediately respond to a request for comment.

The paucity of well-known corporate names among the disclosures doesn’t mean that leading businesses won’t be involved in electoral politics this presidential cycle, according to top corporate lobbyists in Washington.

Major companies are expected to fuel record political activity at the U.S. Chamber of Commerce, which plans to spend at least $50 million on congressional races this year. The chamber, which does not disclose its donors, disputed the amount.

Although many of the nation’s leading CEOs are eager to participate in this year’s election, they largely plan to steer clear of super PACs because of the disclosure requirements.

“I think the Target experience makes them gun-shy,” said Scott Talbott, chief lobbyist for the Financial Services Roundtable, referring to a national boycott against the retail chain in 2010 after it donated to a political group backing a conservative Republican gubernatorial candidate in Minnesota who had made negative statements about gay and lesbian rights.

Simmons, a buyout investor who controls a stable of companies that produce metals and chemicals, has never been hesitant about using his fortune to promote his brand of conservative politics. He gave $3 million to the Swift Boat Veterans for Truth in 2004 and helped finance a nonprofit group in 2008 that spent $2.9 million on ads attacking Obama’s ties to William Ayers, a former member of the 1960s-era Weather Underground.

Simmons has poured $1.1 million into Perry’s campaigns, making him the second-largest individual donor to the Texas governor. Under Perry’s administration, one of Simmons’ companies, Waste Control Specialists, received permission to build the first new low-level radioactive waste disposal site in the country in three decades in an isolated patch of West Texas, despite objections from some state environmental agency staffers.

Simmons now has even more wealth at his disposal: In the last year, his net worth ballooned to roughly $9.6 billion, largely because the stock of Valhi, a chemicals conglomerate he controls, rose 170%, Forbes reported in December.

In the last year, he gave $1.1 million to two super PACs backing Perry’s presidential bid, along with $500,000 to Winning Our Future, the pro-Gingrich super PAC. In the fall, he donated $5 million to American Crossroads, while Contran gave $2 million.

“Mr. Simmons is a passionate conservative, and he has been for quite some time,” said his spokesman, Chuck McDonald, who described Simmons as “pro-business” and a supporter of tort reform.

But Simmons is not pursuing a specific policy agenda with his donations, McDonald said.

“I know people want to think he is,” he said. “He is a man who has a lot of personal wealth and believes in conservative ideology, and that’s where he puts his money.”

Politico: Lobby wars: Top 5 fights of 2011

Monday, December 26th, 2011

Gridlock plagued Congress this year, but that didn’t stop the multi-billion-dollar lobbying industry from duking it out over everything from credit card fees to smog rules.

In fact, a divided Congress, an unruly House Republican freshman class and a Democratic president not winning many friends on the Hill made for a unique environment for K Street to fight epic battles.

Some of the biggest lobbying battles of 2011 pitted mega-influencers against each other, cost millions of dollars, and even drove an arms race for talent on K Street.

Without further ado, here are POLITICO’s top five lobbying battles of 2011:


Big Banks v. Big Retail

The perennial fight over the fee banks charged on debit cards had long kept lobbyists in the green. But 2011 touched off one of the most intense lobbying battles in banking history, pitting Visa, Mastercard and others in the financial industry like JP Morgan Chase & Co. and Bank of America against retailers like Wal-Mart, Home Depot and Target. At stake: more than $15 billion a year in fees banks charge retailers for allowing their customers to pay with debit cards. The banks engaged in an all-hands-on-deck lobbying offensive trying to delay or limit the new rules.

Against the odds, the retailers — lead by the Retail Industry Leaders Association — prevailed in a June. The nail-biter of a vote in the Senate allowed new limits from the Dodd-Frank financial regulatory reform law to be enacted limiting how much banks can charge retailers for using debit cards.

RILA’s Katherine Lugar said that the campaign “was a testament to the lobbying force that the retail industry has become particularly when large and small retailers are perfectly aligned. This powerful alliance will remain intact as we pursue credit reforms in 2012.”

AT&T’s Bid to Buy T-Mobile:

AT&T is no stranger to fighting battles on Capitol Hill. The company has one of the biggest in-house and contract lobbying teams, regularly using third party groups to try and sway public opinion — but the company couldn’t sway the Department of Justice to let its proposed merger with T-Mobile go forward.

AT&T spent nearly $16 million on its lobbying campaign and almost $2 million in campaign contributions in its bid to sell federal regulators on its proposed $39 billion deal. The lobbying campaign captivated K Street and expanded many firms’ bottom line as both AT&T and its opposition (including Sprint) engaged in an arms race of signing hired guns. AT&T’s effort — which included getting more than 70 lawmakers to sign on in support of the deal — wasn’t enough. In spite of its mega effort, AT&T was forced to drop its bid — costing the company nearly $4 billion in cash and spectrum as part of the deal’s breakup fee.

Supercommittee Courts K Street:

The supercommittee, tasked with cutting at least $1.2 trillion from the nation’s deficit, was the talk of the town this fall with K Streeters in the early days often getting more information on potential deals than staffers. But that quickly changed, as the committee went on lockdown.

As veteran K Streeter Gerald Cassidy, founder of Cassidy & Associates, told POLITICO this fall. “During my 42 years in Washington, this is the most closed-mouth committee that I have seen,” Cassidy said.

That didn’t stop the private sector and even state-level officials and other lawmakers from trying to get a word in to give their issues a leg up. Health care and the defense industry in particular amped up their lobbying campaigns — advertising, working members of the powerful panel and also lobbying key lawmakers in leadership. In the six week run-up to panels decision, nearly 200 companies and special interests reported they were lobbying the 12-member panel.

Of course, the supercommittee didn’t pull off anything heroic. But that doesn’t mean the lobbying has stopped. With health care and defense cuts slated to go into effect at the beginning of 2013, K Streeters are already eyeing opportunities to try and find a way to turn back the clock.

Smog Wars:

Greens and public health groups lost big in the summer’s bruising lobbying war over new smog standards.

The White House decision to punt on the long-anticipated smog rules in early September was a gift to heavyweight industry associations led by the Business Roundtable, the U.S. Chamber of Commerce, the National Association of Manufacturers, the American Petroleum Institute and others that lobbied for months to kill tougher ozone standards.

The industry coalition met behind closed doors with EPA top brass, House Republicans and White House officials, and publicly warned that a stricter smog rule – estimated to cost up to $90 billion annually — would hurt both industry and President Barack Obama’s chances for reelection in 2012. They also appealed directly to Obama’s chief of staff Bill Daley, hoping to find a sympathetic audience in the former bank executive.

Environmental and public health groups including the American Lung Association, the Environmental Defense Fund, the League of Conservation Voters, and the Natural Resources Defense Council waged an aggressive lobbying campaign of their own to demand tougher rules. But their arguments about the health and environmental benefits of the rule weren’t enough to spur the administration to risk the political fallout of a new standard heading into an election year.

Business Bests Labor in Trade Brawl:

Businesses looking to boost international exports scored a major victory with the passage of three long-stalled trade deals opposed by labor unions.

Industry champions of the U.S. agreements with South Korea, Colombia and Panama included the Chamber of Commerce, the National Association of Manufacturers and the U.S.-Korea FTA Business Coalition, an umbrella organization representing hundreds of businesses. The businesses and the Obama administration touted the agreements’ potential to bolster exports by $13 billion – with $11 billion in Korea alone – and to create more than 70,000 jobs.

The three deals had languished since they were first negotiated under President George W. Bush, but were able to win bipartisan support in Congress after the Obama administration tweaked the agreements and linked them to the extension of a program that offers money to American workers who lose their jobs due to foreign trade.

Labor unions including the AFL-CIO and other critics fought against the deals, warning that the South Korea pact alone could displace 159,000 workers. Unions also criticized worker protections in Colombia, citing a high murder rate of trade unionists, and accused Panama’s government of neglecting worker’s rights while harboring money launderers.

Several unions broke ranks to endorse the Korea free trade deals. The United Automobile Workers and the United Food and Commercial Workers International Union said they were encouraged by the increased exports of automobiles and meat.

Financial Sense: Interview with Director Francis Megahy

Thursday, December 8th, 2011

Financial Sense

Director Francis Megahy joins Jim on Financial Sense Newshour to discuss his film on the lobbying industry in Washington DC. Politicians now spend more than 25% of their time fundraising, while the number of lobbyists in Washington has more than doubled since 2000. Registered lobbyists have spent over 13 billion dollars in the last six years alone.

Veteran documentary director Francis Megahy, who now lives in the US, began his career in British television, as a writer and director, working on documentaries for the BBC and ITV networks. Later he wrote and directed top-rated television series and television movies. Megahy has made more than forty documentaries for British television channels.

Bloomberg: Secret Campaign Money Will Lead to Political Scandal, Group Says

Wednesday, September 28th, 2011

Executives from major corporations to unions expect that the unfettered flow of cash into elections will eventually lead to scandal.  They’re right.


Undisclosed campaign money that began pouring into political groups during last year’s congressional elections will, without reform, only grow and lead to scandal, a group of business leaders and university professors said yesterday.

An estimated $500 million was spent to influence congressional elections in 2010 by non-profit groups, trade associations, labor unions and corporations with no trace of where the money came from or how it was used, according to the report by the Committee for Economic Development.
This lack of transparency poses a grave threat to our democracy,” concluded the report, which was signed by 32 business leaders and university professors, including representatives from Citigroup Inc., Avaya Inc. and Prudential Financial Inc.
The group says the Federal Election Commission watered down disclosure rules against the advice of the U.S. Supreme Court, opening new routes for secret money to get into elections. It is calling on Congress to pass legislation to require disclosure of all money spent to influence elections and discouraging its members from giving to such groups.
“The system we have now takes good men and women who are elected and corrupts them,” said Edward Kangas, the former chairman and chief executive officer of Deloitte Touche Tohmatsu, at a panel discussion yesterday about the committee’s reform proposal.
Executives from pharmaceutical companies Merck & Co. and Pfizer Inc., and from American Electric Power Co., also spoke at the event in support of more disclosure.
Citizens United
The Supreme Court, in a 2010 case known as Citizens United, allowed corporations and unions for the first time to spend unlimited money on ads advocating the election or defeat of a candidate.
In the decision, the high court expressed confidence that interested voters could easily discern the identities of those paying for campaign ads.
“With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters,” Justice Anthony Kennedy wrote for the 5-4 majority.
Disclosure Requirements
The FEC, however, loosened requirements for disclosure of donors, making groups report the names of contributors only if they are paying for a particular ad, the group said.
The FEC, the agency responsible for implementing campaign finance law, has eviscerated the disclosure regulations applied to campaign advertising,” the report said. “Instead of promoting transparency, the agency has added a new element of secrecy in campaign finance.”
The risks to companies of publicly supporting a political candidate became clear immediately after Citizens United when Target Corp. made a $150,000 donation to MN Forward, a business advocacy group which in turn ran ads supporting a gubernatorial candidate who opposed gay marriage. Gay rights groups boycotted the company and Target CEO Gregg Steinhafel apologized.

That incident showed that “there’s a big risk for companies to go out and be so public politically,” said Barbara Bonfiglio, senior corporate counsel at Pfizer. “It’s just not a place that too many companies are going to be comfortable playing in.”
However, they may be comfortable if their donations aren’t made public, said Fred Wertheimer, president of Democracy 21, a Washington-based group that advocates for limits to money in campaigns.

Electioneering Communications
In the 2010 election cycle, 308 non-party groups reported spending money to influence voters, and only 166 of those reported where the money came from. The U.S. Chamber of Commerce, which reported $31 million in “electioneering communications” spending to the FEC, won’t name any of the companies or individuals who gave it the money.
Independent groups are already raising money for the 2012 elections, with their sights set even higher.
American Crossroads and Crossroads Grassroots Policy Strategies — created with support from Karl Rove and Ed Gillespie, former aides to President George W. Bush — set an initial goal to raise $120 million for 2012 and then doubled that target earlier this month.
They gathered $71 million in 2010, according to spokesman Jonathan Collegio. Crossroads GPS keeps its donor list secret.
Priorities USA and Priorities USA Action, two groups founded by Bill Burton and Sean Sweeney, former aides to President Barack Obama, are trying to raise $100 million to help keep the president in the White House.

Bloomberg: Koch, Exxon Mobil Among Corporations Helping Write State Laws

Saturday, July 23rd, 2011

Corporations are “paying for an opportunity to connect directly with legislators,” said Jeremy Kalin, a former Democratic Minnesota state representative. “It’s an end-run around transparency and disclosure laws. Corporate interests that would otherwise be required to register as lobbyists are writing legislation behind closed doors.”


Koch Industries Inc. and Exxon Mobil Corp. (XOM) are among companies that would benefit from almost identical energy legislation introduced in state capitals from Oregon to New Mexico to New Hampshire — and that’s by design.

The energy companies helped write the legislation at a meeting organized by a group they finance, the American Legislative Exchange Council, a Washington-based policy institute known as ALEC.

The corporations, both ALEC members, took a seat at the legislative drafting table beside elected officials and policy analysts by paying a fee between $3,000 and $10,000, according to documents obtained by Bloomberg News.

The opportunity for corporations to become co-authors of state laws legally through ALEC covers a wide range of issues from energy to taxes to agriculture. The price for participation is an ALEC membership fee of as much as $25,000 — and the few extra thousands to join one of the group’s legislative-writing task forces. Once the “model legislation” is complete, it’s up to ALEC’s legislator members to shepherd it into law.

“This is just another hidden way for corporations to buy their way into the legislative process,” said Bob Edgar, president of Common Cause, a Washington-based group that advocates for limits on money in politics.

As a tax-exempt organization, however, ALEC doesn’t disclose its corporate donors. ALEC doesn’t reveal its corporate and legislative members beyond those who serve as committee chairmen. Its model bills, which now total almost 1,000, are listed on its website, although their full texts can be called up only by members.

Politico: Evan Bayh, Andy Card team up for U.S. Chamber

Tuesday, June 7th, 2011

Apparently Evan Bayh thinks that all the money sloshing around the system is bad until he is being paid by it.


Former Sen. Evan Bayh is adding a gig at the U.S. Chamber of Commerce to his role as a Fox News commentator and his job at a law and lobbying firm.

Bayh, an Indiana Democrat, will join former George W. Bush chief of staff Andy Card on a bipartisan “road show,” in which they’re expected to “carry a bipartisan message on regulatory reform,” according to an internal memo sent from Chamber president and CEO Tom Donohue and first published by the Center for Public Integrity’s iWatch News on Tuesday.

The Chamber plans to officially announce Bayh’s involvement later this month as it launches the “road show,” which is in part aimed at getting Democrats to side with the Chamber in opposing what it sees as excessive regulation by the Obama administration.

“We don’t see this effort as an ‘us versus them’ issue,” spokesman Tom Collamore told iWatch News. “Having a Democrat of his stature gives the effort more heft and an important perspective.” Bayh and Card will deliver speeches, attend events and do media appearances around the country.

The Chamber job is another eye-raising role for Bayh, who decried partisanship on Capitol Hill and the corrosiveness of money in politics when he declared his intention not to run for re-election last year.

In a New York Times op-ed in February 2010, Bayh also spoke out against the Supreme Court’s ruling in Citizens United v. Federal Election Commission, which permits corporations and other groups to spend unlimited amounts of money on campaign ads. “The threat of unlimited amounts of negative advertising from special interest groups will only make members more beholden to their natural constituencies and more afraid of violating party orthodoxies,” Bayh wrote. The Chamber, in contrast, was one of the biggest beneficiaries of the ruling and a major spender in the 2010 election cycle.

Bayh did not immediately respond to POLITICO’s request for comment.

Bloomberg Businessweek: Lobbyists Mobilize to Preserve Tax Breaks

Sunday, May 22nd, 2011

Everyone wants to cut the deficit, but not in a way that would affect their tax breaks!  Lobbyists everywhere are rejoicing.

Bloomberg Businessweek

U.S. lawmakers in both parties are seriously weighing proposals that could shave from $4 trillion to $6 trillion from the U.S. budget over the next decade. For America’s lobbying class, that’s the equivalent of a Category 5 storm warning. So the pinstripe brigade representing interest groups as diverse as ethanol producers, defense contractors, and hospital chains has descended on the nation’s capital in recent weeks to ensure their tax breaks and subsidies are spared. Some 2,000 real estate agents parachuted into Washington the week of May 8 to defend the tax deduction homeowners receive on mortgage interest. Thousands of farmers who want to forestall cuts in agriculture subsidies have also been buttonholing their representatives. “I can’t remember anything close to this,” says Howard Marlowe, president of the American League of Lobbyists in Alexandria, Va., who during three decades as a Washington lobbyist has seen his share of budget battles.

One lobbyist making the rounds is Bob Livingston. He represents Raytheon (RTN) and Northrop Grumman (NOC), two defense contractors that have raised their deflector shields hoping to repel cuts to defense programs dear to them.

In Livingston’s earlier incarnation as chairman of the House Appropriations Committee, the Louisiana Republican helped negotiate the landmark bipartisan budget agreement of 1997. That deal aimed to cut $204 billion over five years and was negotiated when the national debt was $5.4 trillion. Today, America’s tab is approaching the statutory limit of $14.3 trillion, putting the U.S. at risk of default. “The earlier debate didn’t have nearly the same impact as the discussion today,” says Livingston. “The difference is the magnitude of the problem.”

Linked to a vote to raise the debt limit, negotiations on a bipartisan budget pact are getting started between Republicans who want to overhaul Medicare and Medicaid while cutting hundreds of programs and an Administration seeking smaller spending cuts and tax increases. At the same time, the bipartisan “Gang of Six” senators is trying to craft an overarching debt reduction proposal, even after one member—Senator Tom Coburn (R-Okla.)—quit the group on May 17.

While a final deficit reduction plan may be months away, Washington’s lobbying horde is wasting no time. Growth Energy, a group representing ethanol producers, is battling proposals to end the 45 cents-a-gallon tax credit for makers of the fuel, which last year cost the government about $6 billion. If the program is cut, ethanol producers have a fallback position: They want a new tax break to encourage use of vehicles that operate on corn-based fuel and the so-called flex-fuel pumps they need. “We can’t have that go away until we have another form of access in the market,” says Chris Thorne, a spokesman for Growth Energy.

The Service Employees International Union opposes cuts to Medicare and Medicaid, which would affect about 1.1 million nurses and other health-care workers the union represents. Union members visited lawmakers’ home-state offices during the April recess, and five SEIU lobbyists have been meeting with legislators in Washington to urge them to raise taxes to close the budget gap. “We think that rich folks and American corporations have gotten off too easily in some of these proposals,” says Peter Colavito, the SEIU’s director of government relations.

Some lawmakers favor scaling back agriculture subsidies at a time when crop prices are high. The House passed a Republican budget that would cut $30 billion from agriculture programs over a decade. Farmers say they’ve already endured billions of dollars’ worth of cuts to farm programs and that the pain should be spread across additional industries. “We will give our proportionate share, but it’s time for everybody else to cough up some money,” says Chandler Goule, a National Farmers Union lobbyist.

Amid the uncertainty, some groups are taking a hands-off approach—at least for now. The U.S. Chamber of Commerce and the National Association of Manufacturers have drafted a letter to congressional leaders in both parties, urging them to raise the debt limit without suggesting specific budget-changing approaches. Businesses should refrain from fighting specific cuts because that complicates efforts to reach a budget deal, says R. Bruce Josten, the Chamber’s executive vice-president: “If everybody in the business community starts saying, ‘Yeah, raise the debt limit, but don’t touch this and don’t touch that, and don’t do this and don’t do that,’ you’ll never get to an outcome.”

The Chamber’s view stands in contrast to other business interests in Washington. After agreeing to $155 billion in Medicare and other cuts in last year’s health-care law, the hospital industry opposes further reductions in what it gets from federal health entitlement programs. About 1,000 hospital executives in April pressed their case with lawmakers, and the group is drawing on its 25 registered lobbyists to help push back on such proposals as turning Medicaid into a block grant to states. “We’ve already made some serious sacrifice and stepped up to the plate,” says Richard J. Pollack, executive vice-president of the American Hospital Assn.

For the American Petroleum Institute, the lobbying has already paid off. On May 17 the Senate blocked a measure that would have repealed $21 billion in oil and gas subsidies over 10 years. API Chief Executive Officer Jack N. Gerard, who met with legislators in advance of the vote, said of the legislation: “It’s not consistent with what we need to create American jobs and produce American energy.”

The bottom line: Nurses, farmers, defense contractors, and others are fighting to protect tax breaks and programs dear to them.

New York Times: Democrats, Seduced by Secret Dollars

Tuesday, May 10th, 2011

The Democrats are embracing the siren call of undisclosed campaign spending.

New York Times

Last year several pro-Republican advocacy groups degraded the Congressional elections by spending at least $138 million in secret donations on advertisements. The public did not know which lobbying interests gave money, or how much, or what they would demand in return. But the donations became a significant factor in the Republican gains in the House and the Senate.

Now several prominent Democrats are abandoning the high ground and have decided to raise millions of their own secret dollars. They have promised they will again try to pass a law preventing this secrecy if they win. (They were stymied in an earlier attempt by a Republican Senate filibuster.) Whatever they gain in money, they stand to lose far more by giving up principles that President Obama and party leaders once claimed to cherish.

Bill Burton, who until February was Mr. Obama’s deputy press secretary, said last week that he would help lead a group called Priorities USA, which will raise unlimited money from undisclosed sources to aid in the president’s re-election campaign. The initial money will come from the Service Employees International Union and Jeffrey Katzenberg, the Hollywood producer, but more will inevitably begin to flow in from other unions and wealthy Democrats.

Mr. Obama has long claimed to champion transparency and denounced the secret-money sluice operated by Republicans last year as a “threat to democracy.” As he said in October, “The American people deserve to know who’s trying to sway their elections, and you can’t stand by and let the special interests drown out the voices of the American people.” Last year, speaking for the administration, Mr. Burton called for a “bright light” to shine on the shadowy groups.

The White House says the president has not changed his view, but somehow he no longer seems to recognize Mr. Burton as the man who was recently a close aide. “We don’t control outside groups,” said Jay Carney, Mr. Obama’s press secretary. “These are not people working for the administration.”

Mr. Burton now says he does not like the campaign finance rules, which the Supreme Court helped create, but is unwilling to cede the advantage to the Republicans. “The laws we have are not the ones we wish we had,” he said. “But if you want to change the direction of the car, you have to have your hands on the steering wheel.”

It is true that a group founded by the Republican strategist Karl Rove has said it would raise $120 million for 2012, and another set up by the Koch brothers, conservative activists and industrialists, will raise at least $88 million. But Mr. Obama managed to raise the staggering sum of $750 million in 2008. And though he abandoned the public finance system to do it — possibly damaging it permanently — he at least disclosed all of his donors.

If the president stood up and publicly told Mr. Burton to end his effort, that would probably be the end of it. But he has not done so. The White House is clearly worried it will have trouble collecting big checks from Wall Street and other business interests for the re-election campaign, and has decided the political end justifies the unsavory means. At the very least, he and other Democratic leaders could demand that the Priorities group raise its money through an affiliate, Priorities USA Action, which can collect unlimited funds but must disclose its donors.

A political system built on secret, laundered money will inevitably lead toward an increased culture of influence and corruption. Democrats would attract more support as a principled party that refused to follow the Republicans down that dark alley.