--- Doug Henwood <dhenwood at panix.com> wrote:
> Wall Street Paying High Price to Keep Cash
> By Jeffrey H. Birnbaum
"the buyout firms have already distributed at least $5.5 million in lobbying fees, quadruple what they spent in all of 2006, according to Bloomberg News."
I'm always surprised at how little lobbying firms are paid, and how little major industries have to give to politicians, in relation to the benefits they receive.
I suppose it's just enough to keep them out of reach of any public influence group.
BobW
>
> The nascent fight over whether to raise taxes on
> Wall Street hot
> shots has become one of the year's biggest lobbying
> bonanzas.
>
> In order to defeat what amounts to two pieces of tax
> legislation,
> those new high rollers of finance -- private equity
> firms and hedge
> funds -- have been flooding Washington with money.
> Even though
> legislation was introduced just this spring, the
> buyout firms have
> already distributed at least $5.5 million in
> lobbying fees, quadruple
> what they spent in all of 2006, according to
> Bloomberg News.
>
> A single lobbying firm -- Ogilvy Government
> Relations -- received
> $3.74 million in the first six months of this year
> from Blackstone
> Group, one of the world's largest private equity
> firms. That's the
> heftiest six-month payment to any lobbyist ever
> reported -- other
> than a series of fees delivered from 2003 through
> 2005 to the law
> firm now known as Bingham McCutchen.
>
> But the law firm's situation was quite different
> from Ogilvy's.
> Bingham McCutchen was a principal player in one of
> the most complex
> multiyear negotiations ever undertaken in Washington
> involving
> asbestos litigation and legislation. Ogilvy
> Government Relations, by
> contrast, is fighting alongside others to block a
> much more
> straightforward effort to increase the tax rate paid
> by private
> equity managers to the 35 percent range from the
> current 15 percent.
>
> For that, $3.74 million is a lot of money, lobbyists
> around town
> agree. How much is it?
>
> It's 57 percent more than the biggest payment made
> to a lobbying firm
> for all of last year. It's 15 times what Ogilvy got
> from Blackstone
> in 2006. It's nearly double what disgraced lobbyist
> Jack Abramoff
> disclosed receiving in a full year from all but one
> of the Indian
> tribes he represented. And even that tribe reported
> spending less in
> one year than Blackstone is forking over to Ogilvy
> in six months.
> (Those amounts, of course, do not include the tens
> of millions of
> dollars in secret payments Abramoff and his
> associates collected from
> the tribes.)
>
> Nonetheless, of the hundreds of lobbying firms in
> the nation's
> capital, only two dozen received more from all their
> clients put
> together than Ogilvy got this year from Blackstone
> alone through June
> 30.
>
> An Ogilvy official, who said he was not authorized
> to speak on the
> record, acknowledged that the fee is, indeed, large.
> But he said it
> is not as large as it seems. About half of it
> settled unpaid bills
> from 2006, he said. His assertion is hard to verify,
> however.
> Disclosure forms do not reflect what services are
> bought, only when
> payment is made. Blackstone declined to comment.
>
> Ogilvy's effort is headed by Wayne L. Berman, a
> prominent Republican
> fundraiser and the husband of Lea Berman, a former
> White House social
> secretary under President Bush. But he and his team
> are not alone in
> the battle.
>
> Private equity firms and hedge funds have hired a
> who's who of
> Washington lobbyists. They include Kenneth B.
> Mehlman, a former
> chairman of the Republican National Committee who is
> now with Akin
> Gump Strauss Hauer & Feld. Akin Gump received
> $120,000 in the
> year's first half from Kohlberg Kravis Roberts, a
> prominent buyout
> firm, and also got $100,000 during the same period
> from the Private
> Equity Council, the industry's trade group, reports
> show.
>
> Efforts to stop a tax increase have generated
> business for more than
> 20 other firms, including the capital's largest,
> Patton Boggs, which
> employs former senator John Breaux (D-La.),
> lobbyists said. Others:
> Capitol Tax Partners; Johnson, Madigan, Peck, Boland
> & Stewart;
> Brownstein Hyatt Farber Schreck; Public Strategies
> Washington;
> Capitol Counsel; OBC Group; Elmendorf Strategies;
> PricewaterhouseCoopers; and the Nickles Group, which
> is run by former
> senator Don Nickles (R-Okla.).
>
> These firms don't come cheap, though none are being
> paid at the pace
> of Ogilvy. Still, their billings are sure to rise as
> autumn
> approaches and lawmakers return to work.
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