Congress Members Sprint for Money to Lobby After Election
Looking to expand its lobbying and government affairs practice, Covington & Burling (1175L) LLP turned to those who know Congress best: elected officials just finishing their terms on Capitol Hill.
The law firm in March hired Jon Kyl of Arizona, who last year was the second highest ranking Senate Republican, and Howard Berman, a California Democrat who had been chairman of the House Foreign Affairs Committee. The two serve as senior advisers, sharing their expertise and personal knowledge about lawmakers with clients and colleagues lobbying on legislation and regulations.
Since the November elections, at least 22 members of the last Congress took jobs with lobbying firms, running trade associations or handling government relations for organizations. That is an increase of 14 percent over 2012 in the number of former lawmakers now in the lobbying business, according to the Washington-based Center for Responsive Politics, which tracks ex-lawmakers’ employment. Since 1998, a total of 338 former members of Congress have worked as lobbyists or joined such firms for at least some of their time since leaving office.
Covington’s public policy group chairman, Dan Bryant, said he hired the former lawmakers because they “understand the mindset of key members in the House and Senate.” Covington was paid $2.5 million in this year’s first quarter to lobby by Chiquita Brands International Inc (CQB)., Eli Lilly & Co. (LLY), Microsoft Corp. (MSFT), Qualcomm Inc (QCOM)., Wells Fargo & Co (WFC). and others.
Gaining an Edge
Lobbying and other advocacy groups seek out former members in order to gain an advantage over the opposition. A former lawmaker may know about a senator’s family or a House member’s parochial concerns, insights that help advocates make quick, personal connections while pressing a policy position. They also have better prospects for getting a private meeting with their former Senate or House colleagues.
“They know the process, the policy and the players well, so they often have a special inside connection with key policymakers,” said James Thurber, director of the Center for Congressional and Presidential Studies at American University in Washington.
Lawmakers can expect to make a starting annual salary of $250,000 to $300,000 at the low end and more than $1 million at the high end, considerably more than the $174,000 they received for their public service on Capitol Hill, said Nels Olson, who runs the Washington office of Korn/Ferry International (KFY), a recruitment firm.
“For former lawmakers and many staffers, K Street is still a lucrative option for post-Hill employment,” said Sheila Krumholz, executive director of the center. “As a result, the revolving door keeps spinning.”
The law firm of Van Ness Feldman LLP announced yesterday that it had hired former Representative Norm Dicks of Washington state, who had been the top Democrat on the House Appropriations Committee. The firm was paid $800,000 during the first three months of 2013 by a subsidiary of Warren Buffett’s Berkshire Hathaway Inc. (BRK/A) and other clients.
Among the most recent group of members who left office is former Representative Charlie Gonzalez, a Texas Democrat who didn’t seek re-election.
He became VIA Metropolitan Transit’s chief of public engagement, whose portfolio includes government affairs. While in Congress, Gonzalez helped obtain more than $35 million for the San Antonio-based public transit agency.
“Most transit authorities have to rely on government investment,” he said. “The most I can do for VIA is promote things on the merits. I don’t see that it should be subject to any sort of criticism that you leave Congress and work at the local level, still trying to meet the needs of the community.”
Matt Kibbe, president of FreedomWorks, a Tea Party-aligned group that promotes less government spending, disagreed, saying it becomes harder to cut the budget when former lawmakers are representing groups that count on Washington for support.
“They become poster children for everything that’s wrong in the budgeting process,” he said.
Americans for Responsible Solutions, started by former Representative Gabrielle Giffords and her husband, Mark Kelly, to promote gun control, hired Covington on March 12. Kyl and Berman both served on their chamber’s judiciary committees, which will have jurisdiction over the legislation. That experience can inform their advice to Covington’s lobbyists about how to pitch House and Senate committee members.
Giffords, an Arizona Democrat, was wounded in a 2011 mass shooting in Phoenix. In March 2013, the organization, which supports expanded background checks for gun purchasers and limits on the sale of assault weapons, also hired the Majority Group LLC, co-founded by former Representative Walt Minnick, an Idaho Democrat.
Those ex-lawmakers can’t approach the colleagues they left behind until after cooling-off period of two years for former senators and one year for former representatives, according to Kenneth Gross, who run the political law practice at Skadden, Arps, Slate, Meagher & Flom LLP. They face no delay in lobbying the executive branch.
Former Representative Jim Walsh, a New York Republican who spent 20 years in Congress before joining K&L Gates LLP, said relationships don’t change when a congressman becomes a lobbyist. He met with his former colleagues who’d become advocates, just as current lawmakers now meet with him.
“These are people that I knew and had a relationship with and trusted their judgment,” Walsh said. “If I had respect for them as members, I certainly would after they left.” As a lobbyist, “we may leave the meeting and not agree based on their view and the view that I’m representing, but at least they’ve given me the opportunity to make the case.”
Four of the top 10 lobbying firms by revenue during the first three months of 2013 counted former members of Congress among their partners or advisers. Former Senators John Breaux, a Louisiana Democrat, and Trent Lott, a Mississippi Republican, are at Patton Boggs LLP. Clients at Akin Gump Strauss Hauer & Feld LLP can call upon former Representatives Vic Fazio, a California Democrat, and Bill Paxon, a New York Republican.
Others went into the lobbying business on their own, such as former House Minority Leader Richard Gephardt, a Missouri Democrat, and former House Appropriations Committee Chairman Bob Livingston, a Louisiana Republican. Both of them lead firms that were each paid about $1 million from January through March.
Both Gephardt and Livingston’s firms have been hired to lobby on the issue of immigration as the Senate is debating a revision of those laws. A bipartisan proposal drafted by eight senators would tighten border security while offering a path to citizenship for the 11 million undocumented immigrants.
Industry trade associations also covet Capitol Hill expatriates. Democrat Christopher Dodd went a senator from Connecticut to leading the Motion Picture Association of America. Ex-Senator Gordon Smith, an Oregon Republican, is president of the National Association of Broadcasters.
Former House Speaker Newt Gingrich’s post-congressional employment became an issue in the 2012 Republican presidential primary campaign. He was hired by Freddie Mac (FMCC) to help develop the government-backed mortgage company’s messaging with congressional Republicans who were threatening greater oversight of the agency.
Gingrich, who didn’t directly lobby his former colleagues, earned at least $1.6 million for advice over a period of eight years, from 1999 to 2007.
Former Republican Representatives Connie Mack of Florida and Mary Bono Mack of California, who are married, joined lobbying firms after losing races last year, as did former Senator Scott Brown, a Massachusetts Republican defeated in November. After Kathy Hochul, a New York Democrat, lost her re-election bid, she joined Buffalo-based M&T Bank Corp. (MTB) as vice president of government relations.
“Having been on the inside, you learn a lot that can be beneficial to those on the outside trying to form policy,” said Kyl, 71.
Kyl, who said he wanted to practice law as he did before spending 25 years in Congress, announced in February 2011 that he wouldn’t run for re-election. Berman, 72, lost his 2012 re-election to a fellow Democrat, Representative Brad Sherman.
“I wasn’t of a mindset to retire,” Berman said. “I wasn’t thinking of what I wanted to do when I left Congress because I wanted to stay in Congress.”
On hiring former lawmakers, “there are clients and potential clients who feel that’s an important component of a public policy team,” said Holly Fechner, vice chairwoman of the public policy and government affairs practice at Covington. The firm was paid $2.5 million in this year’s first quarter to lobby by Eli Lilly & Co (LLY)., Qualcomm Inc., (QCOM) and other companies.
Such relationships may get former lawmakers the meetings, though perhaps not the results they want, said former Representative Chris Shays, a Connecticut Republican.
“In terms of their influence with the legislators, I think it’s overstated,” Shays said. “Members in the end realize that they do owe their responsibility to their constituents. You need to be able to explain why you voted a certain way.”
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