Republicans take over K Street

The hottest speculation in Washington isn't over who will fill a possible Supreme Court vacancy, but who will take over Jack Valenti's perch atop the Motion Picture Association of America - and the buzz is narrowing to three Republicans, all present or former members of Congress.

Rep. Billy Tauzin of Louisiana says he's running for reelection, but insiders say he might yet be open to the top lobby job in Washington, should Mr. Valenti, a Democrat, step down. The others mentioned are former Sen. Fred Thompson of Tennessee and Rep. David Dreier of California.

It's a sign that the ties between the GOP-controlled Congress and the lobby shops on K Street are getting tighter - with significant consequences for issues ranging from tax policy to healthcare.

While lobbyists have long played a big role in Washington, bending lawmakers' ears and even helping to craft bills, K Street, until the mid-1990s, was Democratic turf. There was little rationale for industry groups, for example, to hire former GOP lawmakers.

But the influence of lobbyists appears to be growing, judging by the flow of money to and from K Street - and the push by Republicans to have members of their party hired for top lobbying jobs.

Some who have led the GOP push for K Street power even talk openly of a career path for young recruits to ponder: Serve in Congress, then "retire" to a pot of gold to follow in a job representing business interests on Capitol Hill.

"The Republicans are putting the Democrats to shame" in forging K Street ties, says Frank Clemente, director of Public Citizen's Congress Project. "The revolving door is becoming more comfortably established and institutionalized."

The trend stems in part from expectations - by both politicians and industry groups - that Republican will retain control of Congress for years to come. In that scenario, K Street can be a fount of money and ideas for Congress, while Congress can supply a stream of experienced and well-connected former lawmakers.

"There are an awful lot of [lobbying] firms looking around and saying, 'Hey, we have no Republicans,' says former GOP House leader Dick Armey. "All of a sudden, after four years, this is a Republican town, not a Democratic town."

Money is another key factor behind the trend.

The growth of lobbying in the 1980s and '90s vastly increased K Street's power as a factor in financing political campaigns. Not only do lobbyists give their own money, but the Washington office also has a big say in directing the contributions of the corporations and interest groups they represent. And those contributions appear to be reciprocated in more business for lobbyists.

"Since 1997, firms that gave over 60 percent of their donations to Republicans saw their revenues increase by over 20 percent; the figure for firms that donate 60 percent or more to Democrats was slightly less than 8 percent," says the Center for Responsive Politics in a 2000 survey of campaign spending by lobbying firms and lobbyists.

Both the volume and direction of funds from K Street has shifted since Republicans took over the House. In 1990, lobbyists contributed $3 million to members of Congress, 26 percent to Republicans. In the 1996 election cycle, that allocation shifted to 50-50. Lobbyists in 2002 contributed $16.2 million to members of Congress; $6.8 million in 2003, with 52 percent to Republicans, according to the Center for Responsive Politics.

In some industry groups, the flow of contributions is even more lopsided. The pharmaceutical industry, which has lobbied successfully to keep price controls out of the new prescription drug bill, gave $26.9 million in the 2002 cycle, 75 percent to Republicans. Health professionals gave $42 million to candidates in 2002, 62 percent to Republicans. And oil and gas interests contributed more than 79 percent to Republicans.

This week, a report by Congress's General Accounting Office offered a reminder of energy-industry access to policymakers. The GAO released its final report on how the Bush administration defined its energy policy, including details on which interest groups had access to Vice President Cheney's energy task force - information the White House had refused to release. The report concludes that "non federal energy stakeholders," including petroleum, coal, nuclear, natural gas, and industry representatives and lobbyists, met regularly with the task force and provided "detailed policy recommendations."

The report stops short of saying they determined the policy, but the policy was weighted in favor of more energy production.

Another example of lobbyists' clout in Congress: a tax battle this fall over how to replace the "foreign sales corporation" subsidy, which was declared illegal by the World Trade Organization. House Ways and Means chairman William Thomas (R) of California, in proposing a $128 billion tax package, has released to colleagues a memo with the names of 179 corporations who have signed off in support of his plan.

Former GOP Sen. Bob Packwood of Oregon, who once chaired the Senate Finance Committee, says a good lobbyist "probably knows his subject better than anyone in town and knows how the law ought to be written. Once you were convinced that his position is the law you actually want, the best way to get thee is to have him write the law."

Democrats in power also worked closely with lobbyists, and benefited from close ties to K Street, but Republicans have a closer ideological fit with corporations that make the connection more powerful, Clemente says.

Until the mid-1990s, the K Street corridor, where Washington's top law firms and trade associations are located, was a largely Democratic domain. But the 1994 GOP takeover of the House changed that, especially after Republicans began suggesting - often not so subtly - that the big lobby shops and trade associations start hiring more Republicans or risk disappointments on Capitol Hill.

"Ninety percent of the new top hires are going to Republicans; it should be 100 percent," says Grover Norquist, president of Americans for Tax Reform, an antitax group. "It would be suicidal of them to go to a Democrat."

To encourage such a change of culture, Mr. Norquist and Tom DeLay of Texas, now House majority leader, launched what they call "the K Street Project" in 1995. They met regularly with lobbyists and business groups to discuss legislative strategy. They also circulated lists of lobbyists, noting ties and campaign contributions to Democrats.

Along the way, the tactics got rougher: In 1998, House Republicans held up a vote on intellectual property rights in a bid apparently timed to chasten the Electronics Industry Association for its plans to hire a Democrat as top lobbyist. The move drew a warning from the House ethics committee.

Still, K Street apparently got the message to hire Republicans. Most of the recent new hires in the lobby shops along the K Street corridor, and especially the top ones, have been Republicans, many from the Bush administration and Capitol Hill. Last week, the Cellular Telecommunications and Internet Association hired former Rep. Steve Largent (R) of Oklahoma as its next president.

"For a short time in Washington [after 1995], there was this perception that... the invaders would be thrown out and the Democrats would be back in control. Now people have the sense that Republicans will control either the House or Senate for some time," says former Rep. Scott Klug (R) of Wisconsin, now with a Washington law firm.

Since 2000, only two Democratic members of Congress have jumped to K Street lobby shops, compared with 15 Republican members. Former Rep. Robert Livingston launched his own lobby shop, after exiting the House during the impeachment controversy in 1999. The Livingston Group is already ranked among the top 10 firms, according to Influence.biz, a Washington-based service that tracks the lobbying profession.

"I still shape and affect policy. The only thing I can't do that I used to do is vote," says Mr. Livingston, in his newly decorated suite of offices. The back of his business card notes that he was chairman of the House Appropriations Committee.

At least 160 former members of Congress are currently registered as lobbyists. As former members, they have special access to the floor of the Congress, the exclusive gym, dining rooms, and the most valuable perk on Capitol Hill: a parking space.

Some of the top Republicans in the 107th Congress are about to see their one-year statute of limitations on lobbying former congressional colleagues expire. These include former House majority leader Dick Armey and Republican Conference Chairman J. C. Watts of Oklahoma. Some say they expect to do much the same work they did in the Congress, but for a lot more money.

Mr. Watts has set up his own public affairs and lobbying practice with two former aides.

Mr. Armey, who championed small government as an architect of the Republican takeover of the House in 1994, is is now a senior policy adviser at Piper Rudnick, a top Washington law firm that logged $48.5 million in lobbying revenue last year. He still owns his signature 1989 Ford pickup but recently bought a new, top-of-the-line King Ranch truck and a new ranch in north Texas. "I was amazed at the courtship: Three law firms and a public relations firm, all of whom were talking [salary] numbers beyond what I had dared to dream," he says.

The reason a former GOP lawmaker is worth so much to a lobby shop is access. Armey notes that while he is still barred from lobbying Congress, he is working on issues with the Bush administration. "You can almost not find an agency in this government that does not have an Armey guy in it," he says, referring to former aides.

The tightening K Street connection will also enhance Republican efforts to recruit candidates and staff for Congress, insiders say. Says GOP activist Norquist: "We can go to young people at Harvard, Yale and U Mass and say ... 'We're not just offering you low paid service jobs. There's a rainbow at the end of the tunnel.' "