WASHINGTON K STREET CONFIDENTIAL These days, everyone needs eyes, ears and a voice in Washington. Here’s how to fi nd yours. BY DAN FISHER

NCE UPON A TIME, BILL GATES BUILT Detroit has automobiles, Los Angeles Microsoft into a software colossus from has the movies, but in Washington, his home base in Seattle with only a single the signature industry is lobbying. lobbyist to watch after his interests in The public-interest reporting organization Washington D.C. Then, Washington taught ProPublica lists 17,138 current “lobbying Gates a hard lesson. representations,” according to federal As competitors like Netscape and records, each one representing a OOracle complained to Congress about company, a nation or an individual who Microsoft’s hardball business tactics, the thinks it necessary to pay somebody Justice Department opened an antitrust else to plead their case before investigation and eventually sued to Congress or the regulators. break the company up in 1998. By 2000, These days, Microsoft lists at least Microsoft was spending millions of 20 di erent lobbying fi rms it pays as dollars a year on a small army of lobbyists much as $110,000 a quarter to advise to counter attacks by competitors and on everything from tech policy to regulators and elect a more sympathetic immigration, while embattled former president in George W. Bush. Nissan chief Carlos Ghosn reported The late-breaking o ensive worked— paying BGR Group, a Republican-a liated Microsoft settled without being broken shop run by former Mississippi Gov. Haley up—but the company’s ordeal taught Barbour, $300,000 last year for help in the tech industry it was no di erent than “resolving an international legal issue.” the railroads, steel mills and automakers “At some point, the game is on, and you that came before it. In Washington, clout can’t know and don’t know if that’s next counts. And the only sure way to acquire month, next year or three years from now. clout is to hire lobbyists who know how to But you have to be on the fi eld,” says Joel convince, cajole and threaten lawmakers Johnson, a former Clinton administration into seeing things their way. senior adviser who now runs Glover Park

Daniel Fisher, a former senior editor at Forbes, is Chief Executive’s legal a airs columnist.

36 CORPORATE BOARD MEMBER SECOND QUARTER 2020

TOP-LOBBY 2Q20 NEW.indd 32 3/4/20 9:47 PM CORPORATE BOARD MEMBER SECOND QUARTER 2020 37

TOP-LOBBY 2Q20 NEW.indd 33 3/4/20 9:47 PM Group, a 170-employee D.C. fi rm whose tanning-bed coup on her website bio. clients include Disney, Apple, Fox and Capitol Counsel’s longtime clients include Lyft. “You can’t just come o the bench the American Academy of Dermatology, in overtime and hope to infl uence the Amgen and Bayer, and the fi rm cites outcome.” more recent success, including helping Tech, once again, is the biggest game to defeat changes in Medicare Part B drug on K Street. With Congress turning its reimbursement. Some describe attention to Google, Facebook and Pharmaceutical companies have Amazon, and whether they hold too much traditionally been the biggest spenders the latest battle power over the Internet economy and in Washington, which is natural given how people receive the news, lobbyists, their vulnerability to regulations and even as “Google versus naturally, are raking in tens of millions of tiny changes in government healthcare dollars to advise these new tech titans spending programs. They spent $295 the world,” with how not to become the next Microsoft. million last year, according to OpenSecrets, Facebook and Some of the money is going to traditional multiples of the $75 million Internet fi rms like international law fi rm Akin Gump, companies spent. Amazon lumped in for years the highest-billing lobbying outfi t The growing power of Google, Facebook in Washington, with fi ve former members and Amazon is forcing them to spend on the Google side. of Congress in its policy shop. But they’re more to monitor and infl uence legislators also hiring newcomers like Fulcrum Public and regulatory agencies, however, as A airs, a Democrat-oriented fi rm run by disgruntled competitors and public- Obama administration alumnus Oscar interest groups stoke the fi res of grievance Ramirez and by Dana Thompson, a former and suspicion. Some describe the latest chief of sta to Democratic Congress- battle as “Google versus the world,” with women Maxine Waters and by Sheila Facebook and Amazon lumped in on Jackson Lee. In total, Google spent more the Google side, and a broad array of than $3 million on outside lobbyists last competitors, from Netfl ix to Internet year, according to government records, startups, on the other. A recent hearing on top of more than $11 million it spent in Colorado demonstrates the challenges on its internal Washington operation. these new industry leaders face as their As Microsoft demonstrated, the risk of power and wealth draw the attention of going it alone in the nation’s capitol is too Congress. At that hearing, lawmakers high. The classic example of a lobbying heard a number of smaller competitors, fail may be the 10 percent tanning-bed including Sonos, Tile and PopSockets, tax that appeared in the Obamacare bill complain that Google, Facebook et al sometime in 2009. The bill’s architects were trying to squelch them with were looking for non-essential services anticompetitive tactics. they could tax to help pay for the “I think it’s clear there’s abuse in the A ordable Care Act’s expansive benefi ts. marketplace and a need for action,” said At one point, they focused on Botox GOP Rep. Ken Buck of Colorado. That injections, but the dermatologist lobby looks like a win for Erik Huey of Platinum killed that idea. So then they targeted the Advisors, which charged Tile $10,000 in largely mom-and-pop business of tanning the fourth quarter of 2019 for advice on salons—and at the last minute exempted “issues related to the technology industry,” “qualifi ed physical fi tness facilities,” which according to federal lobbying records. in plain English are corporate health-club Sonos is advised on competition policy chains. This wasn’t an accident. by Mehlman Castagnetti Rosen & Thomas, Capitol Counsel Partner Shannon Finley, which is stocked with former o cials from a former senior sta er for Democratic Republican and Democratic administrations. Sen. Max Baucus, even brags about the Both fi rms declined comment.

38 CORPORATE BOARD MEMBER SECOND QUARTER 2020

TOP-LOBBY 2Q20 NEW.indd 34 3/4/20 9:47 PM WASHINGTON’S 10 TOP LOBBYISTS

IT IS EASY TO CALCULATE THE TOP-GROSSING LOBBYING Squire Patton Boggs firms in Washington, thanks to detailed records they submit With former GOP Sen. Trent Lott and Democratic Sen. John to Congress on a quarterly basis. But to construct our list Breaux on the masthead, this Washington law firm ranks of top lobbyists, we went behind the dollars to identify the among the most powerful lobbying outfits with special clout firms and individuals who get the call when a company in the defense and energy industries. Squire Patton advises needs to buy the influence only years in the Capitol and a Airbus on military helicopter contracts, BAE Systems on thick Rolodex can provide. Some firms have been around defense and took in $150,000 a quarter last year from for decades and work both sides of the political aisle. Americans for Carbon Dividends, an industry-backed group Others, like Ballard Partners, have surged to prominence pushing for a carbon tax. thanks to their Republican Party credentials and ties to Trump. One thing is common to all of them: Count on Ballard Partners spending a minimum of $10,000 a quarter for eyes and Veteran Florida Republican operative Brian ears in Washington—and probably a lot more. Ballard opened Ballard’s Washington office in 2017, just in time to ride the Trump wave Akin Gump to $14 million in lobbying revenue last year. With $31.2 million in 2019 billings, international law firm Important clients range from the American Akin Gump is the biggest lobbying firm, according to the Kitchen Cabinet Conference, which pays $50,000 a quarter Center for Responsible Politics’ OpenSecrets database. for advice on China trade regs, to General Motors, British Bipartisan staff includes Brian Pomper, former chief American Tobacco and DISH Network. international trade counsel for the Senate Finance Committee; Hunter Bates, former counsel to Sen. Mitch CGCN Group McConnell, and Arshi Siddiqui, former policy adviser to Prominent partners include Matt Rhoades, who managed Sen. Nancy Pelosi. Top clients include Amazon, Altria, the Mitt Romney campaign, and Sam Geduldig, a former Indian tribes, Philip Morris International. Recent victory: staffer for Speaker of the House John Boehner. Blue-chip representing AARP to help repeal a 2017 provision of client list includes Microsoft, Bloomberg, MasterCard and the tax code that required non-profits to pay taxes Grant Thornton. on benefits like parking and transportation. American Continental Group Brownstein Hyatt Farber Schreck The headliner here is David Urban, a former chief of staff to Denver real estate attorney Norman Brownstein Sen. who joined the Trump campaign and led built this regional law firm into a D.C. lobbying the candidate to his crucial victory in . Clients giant with $28.7 million in revenue last year. include 7-Eleven, Amgen, Bayer, News Corp. and Nike. Brownstein’s edge comes from deep, bipartisan connections with legislators and bureaucrats Glover Park Group (Norman Brownstein reportedly was feted at a 2016 Run by former Clinton communications party by Democratic Rep. Nancy Pelosi and GOP Sen. official Joel Johnson, this once-unabashedly Mitch McConnell). Prominent partners include former Democratic shop specializes in legislative Justice Dept. assistant attorney general William Moschella strategy, advertising and crisis communications and former Senate staffer Al Mottur. Clients include with strength in the tech industry. Clients Altria, the American Gaming Assoc., Anheuser-Busch, include Apple, Cisco Systems, Coca-Cola, Keurig and Lyft. FedEx and PricewaterhouseCoopers. Subject Matter BGR Group Co-founder Steve Elmendorf was chief of staff to House Bills itself as “bipartisan” but this firm brought in $21 million Democratic Leader Dick Gephardt and a senior adviser last year mostly thanks to its close ties to the Republican to the Gephardt, Kerry and Clinton presidential campaigns Party. Founded in 1991 by former Mississippi Gov. Haley before turning to lobbying. Clients include Nestle, Ford, Barbour and Edward Rogers, a Reagan White House official, Orbitz and MetLife. BGR also employs former Reagan and Bush administration official Lanny Griffith and Loren Monroe, who served on the Fierce Government Relations George H.W. Bush campaign. Blue-chip client list includes Kirk Blalock and Kirsten Chadwick, both former George the nations of Azerbaijan and Bahrain, American Beverage W. Bush aides, are said to be very close to House and Assoc., Physicians for Fair Coverage, the American Healthcare Senate Republicans. Clients include Delta Air Lines, eBay, Association, Caesars, Airbus and Impossible Foods. Home Depot and Stanford University.

TOP-LOBBY 2Q20 NEW.indd 35 3/4/20 9:48 PM HOW TO HIRE A VOICE IN WASHINGTON ’s surprise victory in 2016 shook up the political establishment WASHINGTON IS AWASH IN LOBBYISTS. But hiring the right one requires and created opportunities for new more than a thick wallet. Some fi rms specialize in getting close to infl uential entrants. Just weeks after Trump’s politicians, others with fi nessing the regulatory process. Here are some tips inauguration in January 2017, longtime on pairing the right lobbyist with your company’s needs. Florida Republican lobbyist and key Trump fundraiser Brian Ballard opened a • Lobbying is relationships. There’s a reason so many fi rms are stocked Washington o ce and signed up clients with former members of Congress, legislative sta and regulators. They from Amazon to Uber who were willing understand how the system works, and they know who they can get on the to pay tens of thousands of dollars a phone. A compelling argument isn’t worth much if nobody listens. month to gain access to the new occupant in the White House. From a Washington nonentity, Ballard • Politics matter—but not as much as they used to. If your issue hinges on vaulted to one of the biggest lobbying support from the executive branch, by all means seek out lobbyists aligned fi rms in the Capitol with more than with the party in power. Not only do they have the right relationships $18 million in revenue last year, according (see above), but they were probably deeply involved in getting the president to OpenSecrets. Ballard’s newly signed elected, either as campaign o cials or by having close ties to the big clients included MGM Resorts International contributors. For four years, at least, those connections can be essential. and private prison operator GEO Group, which got a multimillion-dollar contract to operate an immigrant detention facility • Both parties count. Most legislation is a long, slow crawl, and it helps to soon after signing a $100,000-a-quarter have a lobbying fi rm that can work with Republican and Democrat majorities lobbying contract with the fi rm. in Congress. If your issue involves specifi c legislation or is perennial like tax Ballard’s ascent was rapid, but he is or trade policy, better hire lobbyists from both sides of the aisle. already hiring Democrats to help position the fi rm for the future. A company that is new to Washington might do well • Power is di use. Fifty years ago, lobbyists traded on their tight by hiring a lobbying fi rm aligned with relationships with a few key fi gures in Washington: committee chairs, the current regime, but over time it’s regulatory chiefs or the president’s sta . But power is far less concentrated important to have infl uence over every today. A successful lobbying campaign might involve a crafting a compelling element of government—and constantly policy argument, followed by sophisticated social media messaging, shifting public opinion. With Congress grassroots activism and good old-fashioned arm-twisting in Congress. divided and power di use, lobbying A fi rm that can’t do it all might not be able to deliver the result you need. for a piece of legislation or regulatory change has become similar to running • Bring your checkbook. Ex-Congressmen a political campaign, says Johnson of aren’t cheap, and neither are the Glover Park. Firms devise sophisticated experienced corporate lawyers or policy, communications and social media campaign-fi nance chiefs who stock most programs to undergird any high-stakes lobbying fi rms. The most infl uential outfi ts in Washington lobbying e ort. Washington charge a minimum of $10,000 “There are very few single-party a month for important assignments, and big solutions or one-target solutions, corporate clients frequently pay $500,000 where you say, ‘All we need to do is a year or more. get somebody to get to Trump, or the majority leader of the Senate, or the Speaker of the House,’” says Johnson. “The days of hiring the former chief counsel of the chairman of a committee to fi x your issue are gone.” CBM

40 CORPORATE BOARD MEMBER SECOND QUARTER 2020

TOP-LOBBY 2Q20 NEW.indd 38 3/4/20 9:48 PM