CQ TODAY ONLINE NEWS
– ECONOMIC AFFAIRS
Sept. 30, 2008 – 8:46 p.m.
Business Lobbyists Face Their Own Crunch
By Joseph J. Schatz, CQ Staff
For heavyweight business groups accustomed to having great sway on Capitol Hill, lobbying for the $700 billion financial industry bailout plan has been an exercise in frustration — and shock.
The speed of the debate has left them little time to rally their troops. And the public, meanwhile, has flooded Congress with a torrent of letters and e-mails against the plan.
Business groups are gearing up again for Wednesday’s Senate vote on a revised version of the package, but the memory of Monday’s House vote on the legislation — a 205-228 defeat — will be fresh.
“A lot of manufacturers were shocked,” said Jay Timmons, executive vice president of the National Association of Manufacturers (NAM). “Frankly, we thought that the bill was moving in a positive direction. Obviously, it wasn’t.”
The groups — especially their small business members — are quickly intensifying their efforts to compete with opposition voices. And they’re telling members of Congress more directly about the consequences of the credit crunch, and how it could intensify if the government doesn’t take control of troubled securities.
“It’s called ramping up pressure now,” said R. Bruce Josten, executive vice president at the U.S. Chamber of Commerce, following a raucous conference call with 300 member organizations Tuesday afternoon.
Fighting a Populist Message
The business community’s effort has been hurt by the perception that the administration plan would be a lifeline to wealthy Wall Street executives, even though groups such as the Chamber and NAM are highlighting the fact that they represent thousands of small businesses.
For many lawmakers, constituent phone calls opposing the plan are running 40-to-1 against those support it, Josten said.
“There were a lot of questions, a lot of ranting. We will ramp up and try to overturn the 40-to-1” ratio,” Josten said, adding that businesses want to know “what don’t [members of Congress] understand? There is no credit in the system. . . . There was a fair amount of outrage.”
The astounding speed of the negotiations — Treasury Secretary Henry M. Paulson Jr. first came to congressional leaders on Sept. 18, less than two weeks ago, and a final compromise was reached in the wee hours of Sept. 28 — has left no time to a mount a traditional lobbying effort with business owners fanning out across Capitol Hill.
“This has been a seat-of-the-pants exercise from the beginning,” Josten said.
The group needs to mobilize small business owners, not corporate leaders, and small business owners “can’t just hop on the train and come to Washington,” Josten said.
Business Lobbyists Face Their Own Crunch
Sen. John Thune , R-S.D., said that members have not heard enough from small business owners and farm groups who would suffer most in the dramatic tightening of the credit market. Their voices were drowned out by the opponents.
“That’s what I think most House members reacted to. I think if business and small business groups — agricultural groups, hospitals — got more engaged on this it might have an impact,” Thune said Tuesday. “I think the vote yesterday probably intensified those efforts because, up until now, I don’t think a lot of that’s going on.”
Thune said his office has been contacting South Dakota business leaders and health care groups to find out what the impact has been. “I think you need to hear from the local car dealer . . . from the farm bureau,” he said. “I think these are the kind of things that are really impactful in terms of communications, and I don’t think there’s been a lot of that until now.”
Message Machine Flounders
Communicating the need for the plan is part of the challenge the Bush administration faced from the beginning.
“We have to be very, very careful about how we talk about the things that we’re going to do that affect markets and the economy, and that’s a constraining thing,” White House spokesman Tony Fratto told reporters Tuesday. “We spent a lot of time talking about the problem and how it affects Americans in their daily lives, and it’s a hard thing to do because there are four or five steps involved in that before you get to the kitchen table of the average American family and how it affects them.”
But with the Senate due back Wednesday night and the House on Thursday — and congressional leaders vowing to regroup and pass a bill — at least some members are starting to hear from business groups in earnest.
Rep. Randy Neugebauer , R-Texas, who voted “no” on the bill (
Members who voted “yes” are also being lobbied, given the tenuousness of support for the plan.
“I think when they come back . . . they’re going to have a new perspective on things,” said Francis Creighton, vice president and chief lobbyist at the Mortgage Bankers Association. “The reaction of the stock market and the bond market helps us make our case.”
Groups like the Chamber and NAM are encouraging their members to e-mail and call members of Congress over the next few days, and to tell them the ramifications of their votes.
“The key for us is to make sure that members of Congress hear from real people in the real world” about the negative impact of Monday’s vote on 401(k) plans, payrolls and access to credit, Timmons said. “Frankly, I don’t think enough people made those calls before the vote.”
Benton Ives contributed to this story.
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