Early morning hours before the inauguration of President Barack Obama. (Zuma Press)

President Barack Obama promised that his inauguration would be different from those of previous presidents, but change doesn’t come easily when it requires shaking influence in Washington.

In November, Obama announced that his presidential inauguration committee would not accept donations from corporations, lobbyists, political action committees, or unions. The move appeared to set Obama apart from President Bush, whose official inaugurations were underwritten almost exclusively by corporations and executives.

Despite Obama’s efforts, inaugural festivities still represent a giant loophole in lobbying rules that have grown progressively stricter in recent years. Whether it’s the high-dollar fundraisers underwriting the official inaugural program, or the corporations and lobbyists throwing lavish parties to woo legislators and government officials, influence appears to come with a price tag.

This week, a plethora of official inaugural events, paid for by a relatively small number of wealthy donors to Obama’s inaugural committee, as well many private parties present opportunities for moneyed interests to curry favor with the incoming president and Congress.

Private Parties

Special interests and lobbying firms lure lawmakers with lavish private parties during inauguration week, which are all off the books. Obama is not expected to attend these events personally, but members of Congress, and even members of his administration, who will be the primary vehicle for his change agenda, are expected to show up in droves.
“These private parties are a chance, particularly for lobbyists, to mingle, with state and federal elected officials,” said Craig Holman, the government affairs lobbyist for Public Citizen, a non-profit consumer advocacy organization. “Members of Congress attend en masse.”

Some gatherings are flashy and well-publicized, but many events are discreet, invitation-only affairs that are never advertised.

“Private parties are entirely unregulated and undisclosed,” said Holman. Constituents have no way of knowing whose hospitality their representatives might be accepting during inauguration week. Typically, the costs of these parties don’t count as money spent on lobbying and therefore hosts don’t have to disclose these expenses as lobbying.

The biggest sponsors of private parties are lobbying firms, corporations, and trade associations. Almost invariably, the sponsors have business pending before the federal government, or represent someone who does.

One of the highest profile private galas is sponsored by the National Association of Manufacturers a powerful trade association that spent $6.5 million last year to lobby more than 30 government bodies from the Executive Office of the President to the Department of Education to the CIA. In recent weeks, the association has been a vocal proponent of a bailout for the Big Three automakers.

The association’s corporate member organizations — many of whom have interests pending before Congress — sponsor the event. Some pay as much as $50,000.

A search of Center for Responsive Politics’ online database OpenSecrets.org revealed that nearly all of the event’s sponsors spent significant sums on federal lobbying or campaign contributions last year: Exxon Mobil spent $17.9 million on lobbying in 2008. Agricultural products giant Archer Daniels Midland, another sponsor, spent $1.78 million on federal lobbying last year and its employees and PACs contributed $317,700 to congressional campaigns during the 2008 election cycle (53 percent to Democrats and 47 percent to Republicans). ADM lobbied the U.S. Department of Agriculture, the House, and the Senate on renewable energy issues, freight rail, and taxation. Arch Chemicals spent $120,000 lobbying the House last year. DRS Technologies, a defense electronics firm, spent $2.65 million on lobbying in 2008.

Asked whether lawmakers are expected to attend the event hosted every inauguration, Hank Cox a spokesman for NAM, said often times they do stop by.

“[Hosting the party] enhances our position and our relationship with lawmakers, but nothing concrete,” Cox said.

Smaller organizations with interests in Washington are also getting in on the action. Guests at the Homeland Security and Information Technology Inaugural Gala — a party hosted by smaller defense and technology firms looking to win lucrative government contracts — will enjoy “sweets and treats” at the International Spy Museum in Washington, as well as an open bar, a live performance by R&B singer Jeffrey Osborne, and even actors dressed up like James Bond and Mata Hari. There’s also free valet parking — a real perk this week.

Like the NAM gala, the Spy Museum party is put on with support from various corporate sponsorships with discrete interests. An enterprising homeland security company can sponsor the buffet’s pasta station for just $7,500, according to the gala website. In return, the firm will receive 6 tickets, a half-page ad in the program and a guaranteed shout-out during the sponsor appreciation segment of the program.

One of the hosts of the Spy Museum gala is Carlos Weaver of CLW Services. Weaver and his business partners are among a handful of companies eager to remind lawmakers that they are certified to supply high-tech identification cards for federal employees.

Weaver is expecting about 300 guests from the IT side of homeland security, some from as far afield as California and Texas.

The fondue will no doubt be delicious, but the networking opportunities are an even bigger draw.

Weaver boasted that he expects guests from Congress, an array of federal agencies and local governments. “[It's] a wide mix of government and industry,” Weaver said.

Weaver is forthright about his goals for the party. He sees the gala as an opportunity for his small firm to shine in an industry dominated by corporate giants.

“You know how politics in the world is,” Weaver said. “Everyone hopes that someone sees them and pays attention to them. Everyone wants exposure.”

Obama’s Bundlers

Despite Obama’s promises to make this an inauguration for the people, a study by Public Citizen reveals that a small coterie of big dollar fundraisers are bringing in most of the money.

As of Thursday, the inaugural committee had raised at least $35.3 million. Holman, of Public Citizen, said that his analysis found that 80 percent of that total budget came from just 211 wealthy donors — mainly from the financial sector. He and his colleagues have scrutinized the data from the official inaugural Website, which identifies bundlers by name and employer and lists the amount each person raised.

Individual donations are capped at $50,000, more than ten times what an individual may give to a presidential campaign. Bundling is a simple way around the “no corporations, no lobbyists, no PAC rule.”

“The big bundlers cajole their colleagues and others to make those $50,000 contributions and put them into one large package,” Holman says.

By definition, bundlers don’t just encourage people to mail in their checks, they gather the checks and put their names on the bundles to get credit for their efforts. Bundling isn’t just about raising money for a cause, it’s about keeping score.

The Public Citizen study found that the top fundraisers tend to work in a small number of industries whose fortunes depend heavily on federal policy.

“The leading sector is Wall Street, [among] the inaugural bundlers,” Holman said. “They work with Lehman Brothers, Citibank, Goldman Sachs, and other Wall Street industries. We’re seeing Wall Street pay for the inauguration — and what do you think they want?”

Other watchdogs raised similar concerns about influence-buying through the inauguration.

“At a bare minimum, if you’re giving forty, sixty, a hundred thousand dollars, you’re going to get someone from the administration who knows what your agenda is and you’ll get phone calls returned,” said Mary Boyle, a spokesperson for the watchdog group, Common Cause.
She explained that, if history is any guide, a CEO who delivers a big bundle might be rewarded with a seat at the table the next time the administration wants feedback from her industry. That’s how high the stakes are.

“Our concern is that interests with business before the government are making large contributions and using that contribution to buy access to the president on his top aides,” Boyle said.

Lindsay Beyerstein is a reporter for the Washington Independent.

But that hasn’t stopped the 6^th District Republican from putting the “for sale” sign outside her office and raking in $843,079 from political action committees through Oct. 15 in this election cycle—at least $182,255 of which came from lobbyists, according to the Center for Responsive Politics.

Bachmann sits on the House Financial Services Committee, and the bulk of her corporate PAC money comes from — you guessed it — the financial industry. And while she voted against the Wall Street bailout, as her new ad notes, she has blamed the financial crisis on “hyper-regulation” of the financial industry (as well as poor people) and pledged to release the shackles of federal regulation from them. As part of her solution for getting money back into the system, Bachmann has called for eliminating the capital gains tax, which would benefit chiefly investors in stocks, bonds and real estate.

Listed among Bachmann’s financial services contributors in this election cycle, which doesn’t include the boatloads of money she’s received from individual contributors from the financial sector, are:

• American Bankers Association, $7,000
• ACA International, which represents repo men third-party debt collectors, $10,000
• American Express, $3,000
• American Financial Services Association, $2,000
• American Institute of Certified Public Accountants, $13,000
• Bank of America, $7,000
• Capital One Financial, $2,000
• Charles Schwab, $3,000
• Citigroup, $2,000
• Community Financial Services Association of America, $3,000
• Council of Insurance Agents and Brokers, $5,500
• Countrywide Financial, $2,000
• Freddie Mac, $2,500
• Fannie Mae, $4,000
• Financial Services Roundtable, $3,000
• Financial Services Institute, $1,000
• Genworth Financial, $2,000
• Hartford Financial Services, $5,500
• Independent Community Bankers of America, $4,000
• Independent Insurance Agents and Brokers of America, $9,000
• Investment Company Institute, $3,000
• J.P. Morgan Chase $ Co., $3,000
• KPMG, $11,500
• Merrill Lynch, $3,000
• National Association of Mutual Insurance Companies, $4,000
• National Association of Health Underwriters, $4,500
• National Association of Insurance & Financial Advisors, $4,000
• National Association of Mortgage Brokers, $2,000
• National Association of Real Estate Investment Trusts, $3,000
• National Association of Realtors, $2,000
• National Multihousing Council, $3,000
• National Venture Capital Association, $4,250
• PricewaterhouseCoopers, $10,000
• Property Casualty Insurers Corp., $6,000
• TCF Financial, $10,000
• Thrivent Financial for Lutherans, $2,000
• Travelers Co., $5,000
• Tudor Investment, $4,600
• U.S. Bancorp, $1,000
• United Health Group, $2,000
• Wells Fargo, $1,500
• Zurich Holding Co., $2,50

 

Recently, the Minneapolis City Council opted to hire the international lobbying giant Patton Boggs to advocate for its interests at the nation’s Capitol. Patton Boggs, which is headquartered in Washington, D.C., is an old-school, heavy-hitter in political and corporate affairs, with offices scattered around the globe. The move falls in line with what many other medium-to-large-sized municipalities are doing to get federal dollars. In the past, the city has relied to a lesser extent on Lockridge Grindal Nauen, a local firm that it will continue to retain.

Increasing the city’s presence in Washington DC is bound to open more doors, city officials say, pointing out that the added leverage may be needed now more than ever, given the 2006 retirement of longtime Fifth District Rep. Martin Sabo, who was a high-ranking Democrat.

Minneapolis City Council member Betsy Hodges, who chairs the council’s Intergovernmental Relations committee, says she was struck by Patton Boggs’ depth and breadth of experience. “It has done a lot of work in many different areas and it has a deep pool of bipartisan talent from which to draw,” she notes. Further, transit and transportation issues, which are priorities for the city, are among the firm’s “big strengths and they’ll focus their work in that,” she adds.

Less enthused is Council president Barbara Johnson, who expressed disappointment that Lockridge Grindal, which vied for the $144,000, year-long contract, was not better rewarded for its past performance. “It has stuck with us through thick and thin,” she says, adding that Lockridge Grindal once accepted a pay cut owing to budget constraints. “It has done a good job for us and it’s disconcerting that there’s not more recognition of that.” (An ironic twist: When the city initially hired Lockridge Grindal, it did so contrary to the then-staff’s recommendation of Patton Boggs, according to Johnson.)

More about Patton Boggs: James R. Patton Jr., George Blow and Thomas Hale Boggs Jr. established the law firm in 1962. Since then, it has grown into a “full-service firm with a national presence in every major area of legal representation, and [has] developed our business law expertise — secured transactions, public offerings, financial services,” its website reads.

Further, it has played a role in the “formation of every major multilateral trade agreement considered by Congress,” and was one of the first to see lobbying opportunities within all three branches of government, the pitch continues.

The firm specializes in international and trade law. It has more than 200 clients, which come from over 70 countries and it is well-connected to each major U.S. political party in addition to the private sector. One example: Patton Boggs attorney Robert Luskin represents Karl Rove, the former adviser to President George W. Bush, among many other Who’s Who types. In comparison to other firms of its caliber, Patton Boggs has one of the most diverse dossiers, with agribusiness (including tobacco firms) accounting for the greatest chunk of revenue, according to opensecrets.org.

Patton Boggs counts among its top clients Minnesota-based 3M Company, along with Pacific Lumber and Shipping, the Association of Trial Lawyers of America, Mars Inc., Dole Food Company and Soros Equity Partners. (For a list of its lobbying disclosures, go here.) Denver, San Diego and Buffalo are some of the cities it is working for.

Its reach extends far beyond the U.S. It advocated for Kuwait and approval for the 2004 U.S.-Kuwait Free Trade Agreement, for instance, as noted in SourceWatch. It also represented the government of Cameroon with the U.S. Congress and financial organizations. In recent years, it started a reconstruction practice in Iraq. (This summer it expanded its offices in the Middle East.)

Patton Boggs has regularly found itself at the center of political controversy. For example, its involvement with an American PR campaign for Saudi Arabia following the 9/11 attacks triggered an FBI investigation and the stepping down of one of the partners, The New York Sun reported. Its work for Metabolife International, a company that makes vitamin supplements that have been deemed unsafe, has also been scrutinized.

Despite its checkered associations, City Council member Elizabeth Glidden, an attorney, is pro-Patton Boggs, cautioning against “mixing up the firm and its clients …such a large firm is going to have an array of clients.” Instead, “We need to be sure we’re doing all the right things to be as competitive as other cities of our size. Minnesota as a whole hasn’t capitalized enough on federal funding.”

Though its contract was still being negotiated as of press time, Patton Boggs’ responsibilities to Minneapolis will be to provide counsel on federal grants as they pertain to “tracking opportunities, monitoring applications and advocating on the city’s behalf,” according to a report prepared by city staff. The firm is also charged with developing and implementing the city’s federal agenda, including earmarks, authorizations and policy proposals.

It will cooperate with Lockridge Grindal, which will concentrate on airport noise, transportation and water, and continue to “work closely with the state’s congressional delegation and will play a major role in implementing the city’s transportation policy and project proposals,” the staff report states. The two firms previously collaborated on the city’s empowerment zone program.

Gene Ranieri, director of the city’s Intergovernmental Relations Department, says a new presidential administration will usher in plenty of lobbying opportunities. It will be helpful to have reinforcements, he says, adding, “Patton Boggs has a good relationship with Congress and the [Minnesota] delegation as well.” Some of its priorities in the coming year are related to reauthorization of the transportation bill, appropriations, youth violence and housing issues, among others, he pointed out.

Minnesota political analyst David Schultz agrees. “I think it’s a smart strategic move to leverage money for economic development, infrastructure or anything else [the city] might need,” he says. “I think the decision is driven by pragmatics.”

Sen. John McCain’s campaign took a hit over the weekend when his appointed manager to the Republican National Convention, Doug Goodyear, resigned when Newsweek reported that Goodyear’s lobbying firm, the DCI Group, did $348,000 worth of business with the regime of Myanmar. A day later, Doug Davenport, a regional manager for McCain, resigned when his employment with DCI Group was revealed.

Convention organizers are still looking for a replacement for Goodyear.

According to FEC records, Coleman took $1,000 from Goodyear himself; $1,000 from Angela Flood, DCI Group vice-president; and $2,000 from Justin Peterson, a DCI Group managing partner. Coleman’s campaign received another $2,000 from the DCI Group Political Action Committee.

See also: Norm Coleman + mortgage industry = BFF

The Myanmar connection forced him to resign “so as not to become a distraction in this campaign.”

According to Newsweek’s Michael Isikoff:

[T]he firm was paid $348,000 in 2002 to represent Burma’s military junta, which had been strongly condemned by the State Department for its human-rights record and remains in power today. Justice Department lobbying records show DCI pushed to “begin a dialogue of political reconciliation” with the regime. It also led a PR campaign to burnish the junta’s image, drafting releases praising Burma’s efforts to curb the drug trade and denouncing “falsehoods” by the Bush administration that the regime engaged in rape and other abuses.

Convention spokesman Matt Burns told the Pioneer Press, “In planning any event of this size — and like with any large organization — there are bound to be comings and goings. You simply adjust and move forward.”

The McCain campaign still employs one member of the DCI Group. Doug Davenport is his regional campaign manager and, as head lobbyist for DCI, would have dealt directly with the Myanmar military regime.

Cell phone billing practices and service area coverage limits are among the top consumer complaints both in Minnesota and nationwide. The Minnesota Wireless Telephone Consumer Protection Act (S.F. 833) would require wireless phone salespeople to provide a coverage map to customers at the time of sale, to clearly state both price and fees at the time of sale and to indicate whether that price will remain the same throughout the contract. In addition, providers would have to lay out any early termination fees, and separately list government taxes and fees on billing statements.

The telecom industry has responded by using a nonprofit faux-grassroots organization to spread disinformation about the bill and to encourage unsuspecting consumers to send e-mails opposing its passage to legislators. Mywireless.org presents itself as “a non-profit consumer advocacy organization” that gives wireless consumers “a powerful and unified voice to protect the freedom, value, security and mobility they enjoy with wireless services.”

But in fact, Mywireless.org is staffed almost entirely by telecommunications industry executives, drawn mainly from the ranks of the Cellular Telecommunications and Internet Association (also known as CTIA-The Wireless Association), a lobbying group for the mobile phone and telecommunications industry headed by Steve Largent, the former football star and Oklahoma Republican congressman (1994-2002). (There’s more information about Mywireless’ officers below the jump.) 

In Minnesota, Mywireless has employed a three-pronged strategy to fight the cell phone reform bill:

• placing ads in outlets such as Startribune.com urging consumers to oppose the bill.
• encouraging the public to send a canned and misleading e-mail message condemning the bill to their legislators. The e-mail’s text suggests that the bill would mean higher costs: “Minnesotans already pay over 12% in combined federal, state and local wireless taxes, surcharges and government fees on our cell phone bills each month. Placing additional regulation on wireless service will only drive up our monthly bills even more.”
• lobbying at the Capitol.

On the last count, Minnesota lobbyists for Mywireless.org include Chris Tiedeman, Republican strategist, blogger for the Party of Pawlenty blog, and friend and regular radio guest of Republican operative Michael Brodkorb. In addition, Greg Johnson of Weber Johnson Public Affairs, a company that works for corporate and Republican interests, is a lobbyist for Mywireless.org. Johnson’s other lobbying clients at the Minnesota Capitol include Exxon Mobil Corp., General Motors Corp., and Goldman Sachs. Brian Johnston of Washington, D.C., is also a lobbyist for Mywireless.org at the Minnesota Capitol.

Though dominated by CTIA, the Mywireless.org coalition comprises more than 30 organizations that include 16 chambers of commerce along with sharply right-wing organizations such as the American Conservative Union, Center for Individual Freedom and Frontiers of Freedom. Mywireless.org has also spread its coins generously among some of the pillars of the anti-tax, anti-regulation right through its “grants.” The Heritage Foundation has received funds from Mywireless.org, as did the Hispanic Alliance for Progress Institute, an organization founded by President George H.W. Bush and his Secretary of the Interior, Manuel Lujan, Jr.

FreedomWorks, an outfit led by Republican heavyweights such as former House Majority Leader Dick Armey, former Housing and Urban Development Secretary Jack Kemp (for whom Mywireless.org executive director Kim Kuo once worked) and former White House Counsel C. Boyden Gray, have gotten Mywireless.org grants, as has anti-tax radical Grover Norquist’s Americans for Tax Reform, which in 2006 was implicated in super-lobbyist Jack Abramoff’s influence-peddling scandal.

One Minnesota legislator who got inundated by the Astro Turf e-mailing campaign, Sen. John Marty, railed against the group’s efforts in a note to constituents and supporters:

This year Minnesota legislators have received countless emails urging us to oppose Senate File 833, which “threatens the affordability and accessibility of (cell phone) services for all of Minnesota’s families and businesses.”

To stimulate public opposition to this, the cell phone industry’s ad campaign showed a picture of a frustrated woman looking over a document labeled “State Wireless Taxes and Fees” with a caption: “So why are state legislators threatening to increase the cost of our wireless?”

But there was nothing in the bill that even remotely reflected what one would expect based on the lobbying. It is no more expensive to make the terms of a contract transparent than to hide billing and pricing practices from the consumer. Honest disclosure does not cost more.

Most consumers who contacted legislators would support preventing cell phone companies from deceptive practices. Yet the wireless companies lied to the public, convincing many to oppose a bill they would support if they saw the legislation.

In the House, the bill has passed three committees and is awaiting a hearing in the Committee on Rules and Legislative Administration, and in the Senate, the bill has passed two committees and awaits a hearing in the Business, Industry and Jobs Committee.

Below the jump, a list of Mywireless.org’s execs.

Continued: Click “Read More”Mywireless.org’s executive officers

Steve Largent is the board chairman for Mywireless.org. He is also the president and CEO of CTIA-The Wireless Association. Prior to his experiences lobbying for telecom interests, he was an NFL Hall of Fame wide receiver and a Republican Congress member from Oklahoma.

Jot Carpenter is the director for Mywireless.org. He is also vice president of government affairs for CTIA. Previously, Carpenter held a similar role at AT&T and worked for a Republican member of Congress.

John Walls is secretary of the board of Mywireless.org and vice president of public affairs for CTIA. Before that, he was an anchor for Fox Sports Net.

David Eisenberg, the treasurer for Mywireless.org, worked for Sprint and Centel for a total of 21 years previously.

Kimberly Kuo, the executive director of Mywireless.org, is a past vice president of communications for CTIA and a former executive at enfoTrust, a mobile services and telecom company based in Georgia. She also served as press secretary for campaigns by Republicans Jack Kemp and Bob Dole.

Bobby Franklin is a director for Mywireless.org. He is also the executive vice president of CTIA. Prior to CTIA and Mywireless.org, Franklin was a lobbyist for telecom Alltel. He also worked for a Democratic Congress member.