K Street’s Glorious Restoration

It’s a great time to be a lobbyist, again.

This illustration can only be used with the James Olipahnt piece that originally ran in the 1-24-2015 issue of National Journal magazine. 
National Journal
Jan. 23, 2015, midnight

In the 2008 elec­tion, Wash­ing­ton lob­by­ists were prime rhet­or­ic­al piñatas for the Re­pub­lic­an and Demo­crat­ic pres­id­en­tial nom­in­ees alike. John Mc­Cain de­cried the K Street crowd as “birds of prey,” while Barack Obama de­clared, “I am in this race to tell the cor­por­ate lob­by­ists that their days of set­ting the agenda in Wash­ing­ton are over.” After he pre­vailed, Obama brought to town not only a dis­in­terest in the greasy mech­an­ics of law­mak­ing but also a dis­dain for the pro­fes­sion­al lob­by­ing class; his first ex­ec­ut­ive or­der, on his first full day in of­fice, put new re­stric­tions on ex­ec­ut­ive-branch lob­by­ing.

Even so, Obama’s first two years, fea­tur­ing fe­ro­cious battles over such meaty le­gis­lat­ive ini­ti­at­ives as Dodd-Frank and the Af­ford­able Care Act, provided the lobby shops — Re­pub­lic­an out­fits in par­tic­u­lar — with a mov­able feast. K Street has al­ways leaned right­ward, be­cause cor­por­a­tions typ­ic­ally prefer less to come out of Wash­ing­ton rather than more. (Google’s top lob­by­ist, for ex­ample, is former Re­pub­lic­an Rep. Susan Mo­lin­ari.) With Demo­crats in con­trol of both cham­bers of Con­gress, and the White House push­ing its big ideas, K Street’s cli­ents were des­per­ate to have a strong voice in D.C.

But then came 2010. When the GOP seized the House, it ushered in four years of soul-sap­ping grid­lock that es­sen­tially ground Con­gress to a halt — and left Wash­ing­ton lob­by­ists nearly as dis­gruntled as the gen­er­al pub­lic. Sure, there were Obama ad­min­is­tra­tion reg­u­la­tions and ex­ec­ut­ive or­ders to poke, prod, and counter. But the stas­is on Cap­it­ol Hill was lousy for busi­ness.

Which is why, for Wash­ing­ton’s in­flu­ence in­dustry, the new Re­pub­lic­an-led Con­gress feels like a glor­i­ous res­tor­a­tion after years of be­ing edged to­ward the mar­gins. With Mitch Mc­Con­nell tak­ing com­mand of the Sen­ate to work along­side John Boehner in the House, there’s a sense that even if ac­tion on is­sues such as tax re­form, edu­ca­tion, trade, cy­ber­se­cur­ity, and health care isn’t ne­ces­sar­ily prob­able, it is at least pos­sible. And that’s ton­ic for K Street.

Now there’s lob­by­ing ac­tion to be found in both the ex­ec­ut­ive and le­gis­lat­ive branches, says Ivan Adler, a gov­ern­ment-re­la­tions re­cruit­er in Wash­ing­ton. The com­bin­a­tion of an act­iv­ist Demo­crat­ic ex­ec­ut­ive and a Re­pub­lic­an Con­gress “is the best of all pos­sible worlds,” he says. The ad­min­is­tra­tion has signaled that it will con­tin­ue to be ag­gress­ive in reg­u­lat­ing busi­ness, while the GOP, eager to show res­ults, will be push­ing an agenda that at­tempts to roll back those reg­u­la­tions but also ad­vances af­firm­at­ive busi­ness-friendly le­gis­la­tion. (A good early ex­ample was the reau­thor­iz­a­tion of the Ter­ror­ism Risk In­sur­ance Act, which provides a fed­er­al back­stop for private in­dustry in case of at­tack.)

No one will be­ne­fit like former staffers of Mc­Con­nell’s and oth­er Re­pub­lic­an le­gis­lat­ive lead­ers. “Wash­ing­ton is like a me­di­ev­al king­dom,” Adler says. “Those closest to the king are the most power­ful, and it goes down from there.” At the top of the heap sit two of Mc­Con­nell’s former chiefs-of-staff-turned-lob­by­ists: Hunter Bates, who plies the trade at Re­pub­lic Con­sult­ing, and Billy Piper, who works for the GOP firm now known as Fierce Gov­ern­ment Re­la­tions. Dav­id Schiappa, who served as the sec­ret­ary of the Sen­ate un­der Mc­Con­nell when he was minor­ity lead­er, is now a vice pres­id­ent at the Duber­stein Group, which he joined last year. Schiappa and oth­ers who know Mc­Con­nell well in­sist that a tight re­la­tion­ship with the Ken­tucki­an doesn’t guar­an­tee them any­thing. “It’s not like know­ing the lead­er feath­ers my nest,” Schiappa says. At the same time, he says, “it helps be­cause you know a little bit about the mind-set. You know the way he’s go­ing to op­er­ate.”

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Mc­Con­nell’s pledge to open up the Sen­ate pro­cess more than his pre­de­cessor, Harry Re­id — al­low­ing more floor amend­ments, do­ing less mi­cro­man­aging of high-pro­file bills — also has lob­by­ists lick­ing their chops. It may pro­duce more of a le­gis­lat­ive free-for-all than the Sen­ate’s been ac­cus­tomed to, newly em­power­ing com­mit­tee chairs — along with those who used to work for them. High-level ex-staffers like Schiappa, who mastered the cham­ber’s ar­cane pro­ced­ures (es­pe­cially with re­gard to budget­ing and ap­pro­pri­ations), have be­come es­pe­cially valu­able. In that vein, Cov­ing­ton & Burl­ing’s suc­cess­ful woo­ing last year of former Sen. Jon Kyl of Ari­zona, once a top lieu­ten­ant to Mc­Con­nell, looks pres­ci­ent. The lead­er’s prom­ise of a re­turn to so-called reg­u­lar or­der, Kyl says, “will make it easi­er to get things done. Those who do un­der­stand pro­ced­ure will be able to deal with this re­dis­covered ‘phe­nomen­on.’ ”

Kyl was be­ing sar­cast­ic, but he has a point. Be­cause of the volat­ile elect­or­al cli­mate, the Sen­ate has lost a tre­mend­ous amount of in­sti­tu­tion­al know­ledge in re­cent years. “If Mc­Con­nell can’t make it work,” says Rich Gold, a Demo­crat­ic lob­by­ist at Hol­land & Knight, “five years from now you could have a Con­gress that doesn’t re­mem­ber how to func­tion.”

With out­side ex­pert­ise at a premi­um, the GOP firm Clark, Geduldig, Cran­ford & Nielsen snapped up Doug Schwartz, a former top ad­viser to Sen. John Thune of South Dakota, who now chairs the Com­merce Com­mit­tee, which deals with glob­al trade is­sues such as the Trans-Pa­cific Part­ner­ship, a high pri­or­ity for the White House and a rare source of pres­id­en­tial-con­gres­sion­al com­mon ground. Wilmer­Hale hired Rob Leh­man, a former top aide to Sen. Rob Port­man of Ohio (dat­ing back to Port­man’s time as U.S. Trade Rep­res­ent­at­ive), to run its le­gis­lat­ive-af­fairs prac­tice. An­oth­er firm bet­ting big on the new cli­mate is Har­binger Strategies, formed by Kyle Nev­ins and Steve Stombres, both former top aides to Eric Can­tor, the House ma­jor­ity lead­er un­til he fell to a Re­pub­lic­an primary chal­lenger last year. An­ti­cip­at­ing tax-policy battles, Nav­ig­at­ors Glob­al tapped Cesar Conda, who worked on the Bush-era tax cuts, after his stint as chief of staff to Sen. Marco Ru­bio of Flor­ida.

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New lead­er­ship on the Hill em­powers the K Street sher­pas who know the le­gis­lat­ive ter­rain bet­ter than those they’re guid­ing. Conda says that Hill vet­er­ans like him­self are in­dis­pens­able to the rest­less young con­ser­vat­ives in both cham­bers — mem­bers, aides, and ad­visers alike. “They lack the ex­per­i­ence in cut­ting le­gis­lat­ive deals and mak­ing com­prom­ises needed to get bills passed,” he says. At the same time, Conda notes, it helps to be fresh from work­ing on a con­gres­sion­al staff, be­cause it’s also “es­sen­tial for lob­by­ists to un­der­stand how today’s staffers think.”

Though the ac­tion’s hot­ter than it’s been since 2010, the den­iz­ens of K Street cau­tion that nobody should be fool­ish enough to ex­pect it to trans­late in­to, you know, res­ults. After all, Obama is still in the White House, veto at the ready. But while this may prove frus­trat­ing for the lob­by­ists’ cli­ents, it’s yet an­oth­er boon for the in­dustry. Le­gis­la­tion, says a Re­pub­lic­an lob­by­ist who re­ques­ted an­onym­ity, “takes years and years to come in­to fo­cus. It’s why guys like me can get paid for so long.”

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