The Corner

Economy & Business

Two More Looks into the Mammoth Lobbying Effort to Save Ex-Im

In my testimony before the Senate on the Ex-Im Bank last week, I mentioned that it’s not very hard to tell who the big-time beneficiaries of corporate welfare are — they have the incentives and the means ot make their interests heard. This Washington Post story elaborates on that point:

 

“It was pretty obvious to us then that this was going to become the type of issue it has become,” said Dempsey, vice president of international economic affairs for NAM [National Association of Manufacturers], which represents 14,000 manufacturing companies. “It’s long been important for the NAM but it’s really only been in the last few years that it’s become so controversial. We’ve really had to heighten the level of activity on it.”. . .

Last year, NAM, which has long maintained its own in-house lobbying team, began adding more resources and manpower to save the bank while amping up lobbying spending to a nearly all-time high of $12.4 million in 2014 — a 63 percent jump compared to the previous year.

Among the beneficiaries of this increased spending are former House Majority Leader Dick Gephardt, a Democrat, and former Republican National Committee Chairman Haley Barbour, both the heads of top D.C. lobby firms, Gephardt Group and BGR Group, respectively. For their work on Ex-Im, Gephardt’s firm has earned $260,000 and Barbour’s firm has earned $350,000, according to lobbying records.

NAM also paired up with the Chamber of Commerce to create the coalition Exporters for Ex-Im, a group of 50 national, state and local business groups supporting the bank’s extension, in part to coordinate letter-writing campaigns to lawmakers and organize a fly-in. The coalition is represented by Hamilton Place Strategies, the advocacy firm run by former George W. Bush aide Tony Fratto, whose efforts include tweeting at lawmakers to support the bank. . . .

“We’ve put a massive amount of effort into the Ex-Im Bank since last year,” Dempsey said. “It’s very much a priority for the NAM. This has been an all-of-organization type of effort.”

NAM is not alone. Boeing, the bank’s biggest beneficiary, has 36 lobbyists on contract who spent at least part of their time lobbying on Ex-Im during the first quarter of 2015. They’re spread across six firms — Simmons & Russell Group, Washington2Advocates, CGCN, Monument Policy Group, S-3 Group and McBee Strategic — with each shop earning between $40,000 and $60,000 in fees for their efforts during the first three months of 2015, according to lobbying records.

The aerospace giant’s roster of lobbyists includes Kyle Simmons, Senate Majority Leader Mitch McConnell’s former chief of staff; Sam Geduldig, former political director to John A. Boehner (R-Ohio) before he became Speaker; and John Scofield, a former top Republican House Appropriations Committee aide. A Boeing spokeswoman did not return a request for comment.

And that’s just the most obvious. Over at Congress Pulse, Julian Pecquet writes that some of the biggest foreign beneficiaries of Ex-Im in the Middle East are lobbying in a more covert way: 

While the US debate on reauthorization has focused almost exclusively on domestic politics, foreign countries across the Middle East and around the world are also paying close attention to what’s happening on Capitol Hill. Lobbyists for the UAE, for example, have sought updates from the House Ways and Means and Senate Finance Committees, according to government filings, while avoiding direct lobbying that could easily backfire.

“I would assume that governments from around the world — not just the UAE — are expressing an opinion behind the scenes, letting people know how important the bank is,” US-UAE Business Council President Danny Sebright told Al-Monitor. “But it might be seen as impolitic for any government to come out … openly and publicly.”

That’s what those of us who are fighting to end cronyism are up against. But this time around, the wind seems to have shifted a bit — the Ex-Im fight is rightly being seen in the larger context of a broader rejection of government-funded privileges for a handful of connected actors. It’s encouraging to see how many journalists, scholars, and lawmakers are now standing up to fight for the unseen victims of corporate welfare.

Lobbyists often win individual battles, but they won’t keep winning the war. It will be harder and harder – and more and more expensive – each time around. Ultimately, this is a battle of ideas, and ours are winning, slowly but surely. When that happens, lawmakers will not dare standing up for corporate interests like too many of them still do, because they will face electoral consequences for it.

Veronique de Rugy — Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.

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