Lobbyists ready for a new fight on US spending

New York TimesOctober 19, 2013 

— Throughout the tense fiscal deadlock in recent weeks, some of the most powerful forces in Washington – including retirees and defense contractors – largely sat on the sidelines. Now they are preparing for a political fight with billions of federal dollars at stake.

With automatic cuts, a result of sequestration, to the military set to take effect by January, and a separate round of cuts scheduled for Medicare, lawmakers will have to decide who gets hit the hardest, prompting Washington’s lobbying machine – representing senior citizens, doctors, educators, military contractors and a wide range of corporate interests – to gear up to ensure that their slice of federal money is spared in new negotiations over government spending.

It is a debate that almost no one involved wants to have so soon after the nasty fight over the federal budget that produced the 16-day shutdown. But Congress managed to reopen the government and extend the nation’s borrowing limit largely by creating a new series of deadlines that run through February, giving special interests several chances to influence the process.

So far, the defense industry is likely to be hit the hardest, as the automatic cuts set for January would slice an additional $20 billion from the Pentagon’s budget.

“It’s fair to say the volume in Washington is going to be deafening,” said Marion Blakey, chief executive of the Aerospace Industries Association.

Republicans on Capitol Hill are determined to mitigate those cuts by spreading them among various social programs, like education funding and Social Security, bringing dozens of other special-interest groups into the picture.

“The perfect storm is coming,” is how one health care industry lobbying coalition put it, in an advertisement that ran the day the shutdown ended, complete with dark clouds and lightning. “Tell Washington, no more hospital cuts.”

Lobbyists ‘turn up the heat’

AARP, the giant nonprofit group that represents senior citizens, has kicked off a million-dollar radio advertising campaign warning that “Seniors are no bargaining chip.”

Sen. Bob Corker, R-Tenn., said he regrets that Congress has created a situation where another budget fight is about to begin – immediately after a crisis ended.

“I have to believe the American people are totally fatigued with this issue, and to be candid, I am pretty fatigued with it myself,” he said in an interview Friday. “It is almost an embarrassment to keep bringing it up.”

But at least, Corker added, the focus this time will be on how the government spends its money, a debate that he said is important to the nation at large.

For lobbying firms, fights like this are good for business. Their revenues have dropped over the last two years because little legislation has moved forward. Now industry lobbyists, in the aftermath of the shutdown battle, say they see hints that this is the right moment to re-engage.

Separately, major American corporations like the Silicon Valley tech giants are once again preparing to step up their campaign to persuade Congress to pass a comprehensive immigration law, an effort that has been dormant since late spring. That will include a late November “Hackathon” that will bring together Silicon Valley executives and unauthorized immigrants to contact members of Congress to push the cause. Technology companies want immigration legislation that would expand the number of visas issued to foreign workers who can fill engineering jobs, because of a shortage of candidates in the United States.

At the same time, many of the major business groups – including the National Retail Federation and the National Federation of Independent Business – plan to push for modest changes in President Barack Obama’s health care law, convinced that the defeat of the Republican plan to defund the program has presented them with an opening to seek revisions they want, like changing the definition of a full-time worker entitled to health insurance to 40 hours a week, up from the 30 in the law.

“This is the time to turn up the heat,” said Neil Trautwein, a lobbyist with the National Retail Federation.

Unavoidable conflict

The lobbying factions will not, in most cases, be attacking one another. But with Republicans insisting that they will not back down from spending limits set by the 2011 legislation that created the sequester cuts, and the Republicans also rejecting calls by Democrats for new tax revenue, cuts will almost certainly have to hit some interests, creating unavoidable conflict.

“Everybody who has a piece of pie is now going to try to protect their piece of the pie,” said Steve Elmendorf, a former House aide who now runs a Washington lobbying firm that represents defense and health care industries, each of which will be engaged in the debate.

Joel Packer, the top lobbyist for a group that calls itself the Committee for Education Funding, spent last week giving a series of pep talks to education officials across the United States, urging them to get involved, to urge Congress to restore the first round of sequester cuts, and reject any plans by Republicans to make them even larger.

Even before the government shutdown, realizing this battle was fast approaching, education officials organized by the group held a rally in Washington featuring a mock bake sale, which they followed up by distributing bags of cookie crumbs to lawmakers’ offices on Capitol Hill. “No More Budget Crumbs for Students and Education!!” said a flier promoting the effort.

Packer will continue the push this week during a gathering in Washington that will feature more than 100 presidents and other top officials from community colleges nationwide.

Elsewhere on Capitol Hill will be defense industry executives, including Gregory Bloom, chief executive of Seal Science, a small California defense contractor, who will be flying to Washington for meetings with lawmakers to push them to block additional defense cuts.

“Our national security has become a pawn in the chess game,” he said. “But everyone needs to remember that the government’s No. 1 responsibility is still to protect its people from enemies, domestic and abroad.”

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